There is a great deal of wisdom that can be gained from owning and operating a small business. The valuable lessons learned can also provide a boost to new entrepreneurs who are investing their time, effort and money in trying to get a business off the ground.
Several CEOs shared their experiences in features by Business Insider and Business News Daily, specifically about things they wish they had known when starting a business. Here’s a sample.
An entrepreneur may get overwhelmed as a small business takes its first baby steps. The level of responsibility can be dizzying at times, and how the owner handles these moments is important for long-term success. Rachel Katz Galatt, CEO and founder of Maternal Science Inc., describes her approach in Nicole Fallon’s roundup for Business News Daily.
“I’ve always enjoyed wearing many hats and juggling multiple responsibilities; however, many of the functions I am now managing were owned by corporate: tax returns, balance sheets, bill payments, etc,” she says. “All of these functions in the financial discipline, especially the money that pays for the programs to grow my business, would have been handled by another department. I knew that I was going to be taking on these responsibilities, but I didn’t really grasp or think about what it entailed. It is definitely very eye-opening and has forced me to become much more disciplined.”
Lean on others
It’s important for new business owners to know there is a positive support system within the company. Learning how and when to delegate will probably take some time. Anisa Telwar, founder and CEO of cosmetics company Anisa, talks about this in Max Nisen’s Business Insider piece.
“The one thing I wish I would have known when I started my business was that I did not have to be the smartest person in the room,” Telwar says. “I thought as the owner and president that I had to have all of the answers and create all of the solutions. Over 20 years and through the maturity and growth of the business, I learned that it was impossible for me to do it and know it all. In order to grow my company and increase its value, I was forced to let go.”
Perfection isn’t realistic
Small business owners may pride themselves on being thorough, and paying close attention to every aspect of the company. What they may find, however, is that this isn’t always going to be possible, especially as problems arise or as growth opportunities present themselves. Brij Patel, cofounder of Fetch Storage, explains his perspective for Business News Daily.
“When I started my first business, I had a hard time keeping things moving due to a desire for perfection in every little detail,” he says. “I was delaying making important decisions because I often felt the circumstances weren’t optimal, and this ultimately stunted the growth of the company for some time. I learned that it is often more important to make a decision promptly than it is to get it perfectly right. Stagnancy is poisonous for a small company, and decisions are what will keep everything moving toward your goals.”
The challenges never end
In other words, it’s always something. Even those with a great deal of experience can find themselves exasperated by the constant small-business fires to put out. Jim Scott, founder of creative agency mono, describes this for Business Insider.
“It really doesn’t get easier,” he says. “That’s one thing I wish I knew back when we started our agency. Like a lot of startups, we launched the company from an attic. And as my two partners and I set out to conquer the world, we thought we’d follow a particular path, one that was exceedingly difficult at the beginning, but eventually, when we made it, it would be easy. As it turns out, we’re still working as hard as we ever have.”
Hiring is everything
There’s something to the old saying “You’re only as good as the people around you.” Finding the right people to help launch and maintain a small business can be a significant challenge. Sabrina Parsons, CEO of Palo Alto Software, is included in the Business Insider feature, and says that hiring requires a detailed interview process.
“I’ve learned the importance of taking the extra steps to hire and retain talent that fits best with our company and culture,” Parsons says. “It’s important to assign ‘homework’ assignments that fit the role we’re hiring for and have candidates present their assignment to us, or even the entire team they’ll be working with, during the interview process. We also make sure to check several references, ask challenging questions, and role play during interviews. … We’ve found that if we don’t take these steps it can sometimes result in a hire that is not a good fit for either party. So taking the time to do due diligence on candidates has been tremendously helpful.”
It’s no simple task to plan for all financial possibilities, including capital requirements, expenses and revenue potential. New small business owners may need advisers to help guide them. Wayne Connors, managing partner of 401kInvestor.com, discusses this in the Business News Daily story.
“Too often entrepreneurs are overly optimistic in their sales projections,” he says. “They don’t accurately know their customer acquisition costs, and they usually underestimate the capital they need. My rule of thumb is that whatever amount of money you think you need, double it.”
This is a struggle for many of us, regardless of profession or status. Small business owners may get so involved in the day-to-day operation that they neglect their life outside of it. Here’s how David Morken, CEO and founder of Bandwidth, describes it in the Business Insider piece.
“My company has an ’embargo policy,’ which means that when on vacation, none of our employees are allowed to contact work and vice versa,” he says. “The lesson is that business owners do not put enough value on free time, so [they] face burnout. Leaders also need to hire and train employees effectively, so others are best prepared to lead in their absence.”
Don’t get attached
It’s only natural to find a sense of pride in starting a small business and watching it grow and flourish. That kind of connection can be difficult to deal with down the road as opportunities arise and circumstances change. James Green, CEO of ad technology company Magnetic, describes this for Business Insider, saying he wishes he had known that he “shouldn’t get emotionally attached” to businesses he created.
“Companies have no feelings, and they are things, not people,” he says. “Put bluntly (and laying aside non-profits and other nontraditional entities), companies are here for one reason and one reason alone: to make money. Everyone knows that money can’t buy you love, and by extension it makes no sense to love your company. There may come a time when you have to change it, dissolve it, close it, give it to someone else to run, cede control to investors, or any other number of things.”
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