In 2017, the “entrepreneurial bug” is prolific. For those bitten by it, there is nothing more invigorating than the seed of a successful business idea.
But in our startup-saturated society, with an abundance of businesses that promise to disrupt everything from the daily commute to dental floss, the truth is that only a small percentage of companies ultimately make the cut. When it comes down to it, entrepreneurship is hard — and reaching the upper echelons of success requires a serendipitous cocktail of dedication, passion, people, and sometimes, a little bit of plain luck.
The right advice is key, too. There’s no better source of wisdom than those who have navigated the stormy seas of entrepreneurship and emerged victorious on the other side — especially if they’ve managed to do it not just once, but repeatedly. We spoke to several such serial entrepreneurs on the Sunday Times Hiscox Tech Track 100 list (read their success stories here) to get their top tips. Below are the key takeaways for budding entrepreneurs.
Passion is fundamental
Nearly every entrepreneur who spoke to Mashable emphasized the importance of passion. When taking the leap into the great unknown, having a strong belief in your idea is an absolute must.
Clive Jackson, an entrepreneur who has built 14 companies over the course of his entrepreneurial career, agrees that fervour is fundamental. Often, deep-seated passion is what separates the wannabes from the success stories.
“When you set out down the path to be an entrepreneur, do not think you’re setting out to make millions and look great amongst your peers … it isn’t about you showing off. It’s a long and painful process, and the demands upon you are enormous. Be very genuinely passionate about why you’re doing it, and about wanting to create something. That’s the first hurdle,” he says.
Marc Biles, an entrepreneur who has assisted in the launch of a total of 16 businesses, says entrepreneurs need to be prepared to embrace words like “relentless” and “obsessed.”
“If you’re going to launch your own business, it’s going to be really hard work. You’re going to spend more time working on it and thinking about it and living and breathing it than you will on anything else,” he says. “You’re going to forget friends’ birthdays, you’re going to turn up late to family get-togethers, you’re going to stare at your email whilst you should be listening to the story your partner is telling you on date night. If you’re going to dedicate yourself on that level to something, you need to really love it,” he says.
Stress test vigorously
Jackson attributes many entrepreneurial misfires to a lack of critical stress testing — burgeoning entrepreneurs need to poke holes in their concept and go to great lengths to consider every possible competitive threat.
“Once you’ve got an idea, a concept, a vision and you think it sounds great — you think to yourself, “Why wouldn’t somebody do this?” — once you have modeled it out, and you’ve articulated and documented it, then turn it on its head. Ask, why would somebody do this?” he suggests.
Hand in hand with stress testing, new entrepreneurs must avoid developing blinders when it comes to a concept’s feasibility and potential for scale.
“People don’t size the market properly, they don’t go out there and do the research, they don’t genuinely look at the competitive threats that are out there,” says Jackson. “There may only be 45,000 people in the world who this [idea] would appeal to.”
To mitigate this skewed sense of optimism, Jackson says entrepreneurs need to meticulously scrutinize their closest 10 competitors or potential competitors.
“Genuinely write a paper with an introspective reflection about how you would undo your great new startup,” says Jackson. “So many people think that their idea is so good and so different, but they never really stress their value proposition to the point as to whether it is defendable. So they tend to get carried about with how many people will bite.” This, he explains, leads to bewilderment when entrepreneurs sit down in front of a group of investors who point out obvious flaws and vulnerabilities in the business plan.
Richard Theo, an entrepreneur who has been at the helm of six businesses throughout his career, adds that it’s important to test your idea on real people — not just friends and family. “Friends and family will always just give you the ‘X Factor answer’ — i.e. they’ll tell you you’re a great singer, even if it’s painfully evident that you’re not,” he says.
Know your numbers, and know when to seek outside help
Thanks to the internet, podcasts, and a plethora of print material about building businesses from the ground up, there are innumerable resources out there for would-be entrepreneurs.
So, says Biles, it’s shocking how many people dive off the deep end without conducting proper due diligence. “It’s amazing how many businesspeople I meet who could tell me how much Neymar’s transfer fee was when he was sold from Barcelona FC to PSG — but couldn’t tell me what their conversion rate by source is or how their attrition rate over time is changing, etc.,” he says.
Dana Tobak, a renowned broadband entrepreneur, reiterates that hard numbers are the yin to the yang of “gut feeling.”
“Knowing the potential full cost of your decisions is important,” she says. “Don’t assume you’ve properly forecasted all your costs and customers. What happens if the price of your biggest input goes up? What happens if it takes double the time to bring a product live? You may not need to plan for the worst circumstances, but you need to understand the full range of potential outcomes.”
Being intimately acquainted with your startup’s metrics and pain points, too, will help when it comes time to seek funding.
“I think for early-stage growth companies, it’s key to understand when and where to bring in financing,” says Jackson. “Victor, my 14th company, is the first one where I’ve brought in external funding, and I’ve scaled faster and quicker than any of my peers in the private jet charter space by leaps and bounds.”
Jackson also says that recognizing when to be flexible and when to be “encompassing” is another key piece of the puzzle.
Don’t constrain yourself with a ‘small shopkeeper’ mentality.
“Don’t constrain yourself with a ‘small shopkeeper’ mentality because you want to control the shop and be in charge of everything and do it all your own way,” he says. “There’s nothing wrong with wanting this; but fundamentally, if you’re going to attract sophisticated investors, they need to be able to see that you’re not so dogmatic in your views that you can’t see the woods for the trees.”
This, Jackson recognizes, is perhaps the most paradoxical element of entrepreneurship: Founders must be passionate — practically to a fault — yet still willing to relinquish control and accept external input.
“You have to drive through with a huge amount of tenacity, but in the same breath, constantly look back and be very reflective about what you do,” he says. “You have to constantly ask, ‘Can it be done any better?'”
Think long and hard about elements of company culture
Giles Palmer, founder and CEO of social listening platform BrandWatch, paints the picture of the ideal entrepreneurial Venn diagram: “Figure out how to be in the crosshairs of resiliency, compassion, and hard-work,” Palmer says. “Those for me are the three most important characteristics of successful entrepreneurship. You get the ups and downs… there’s one step back, three-quarters of a step forward, two steps back, three steps forward … it’s just an ongoing journey.”
Palmer emphasizes the importance of compassion in the workplace. “As you work with other people, you need to care,” he says. At his company, for example, he has turned compassion into a concrete values system that defines the company culture. Truth, authenticity, accountability, and connectedness also make the list.
At Tobak’s company, Hyperoptic, she says she takes an approach of “active management” to ensure strong culture and continuous growth.
“It’s conscious decision-making,” she says. “Don’t let things just ‘happen’ — make conscious decisions about your people, your products, and your processes. Agree on priorities — some things will have to wait, others can’t — and make sure everyone on your leadership team agrees.”
Biles adds his two cents to the point of compassionate culture: “Be generous. Be generous with your time, be generous to your customers, be nice to people generally and good things will happen to you,” he says.
The entrepreneurial journey certainly has its ups and downs — but listening to the advice of those who have forged their own path provides a valuable foundation for success. With the right people by your side, a sense of perseverance, a passion for your product, and a pinch of luck, you can set yourself up for the best possible chance of prosperity.
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