Rules are meant to be broken, right? Sure, you can break rules whenever you want, but just remember: there are consequences.
Over the past 10 years, I’ve broken a lot of rules. Each time I did, it resulted in a negative consequence. In most cases, the consequence didn’t occur immediately; however, it did occur eventually.
If you want to be a daredevil, by all means, break rules. But if you want to create a thriving business, you should follow rules. And, more importantly, you should follow these rules:
Rule #1: Never fly solo
Google, Apple, Groupon, Zygna, and Microsoft are just a few examples of companies that are doing very well. Do you know what they all have in common? They were all founded by multiple co-founders.
If you want to get into the business world, do it with someone. Flying solo may sound great at first, but things can get tough if you don’t have a co-pilot. This way when you are unsure of what to do when things get tough, you have someone you can consult.
The most important time to have a co-founder is when you first start your company. This is typically the time when cash is tight and you can’t afford to hire people even though there is a ton of work to be done.
If you are one of those lucky few that already have a co-founder, good for you! If you don’t, you should read this article as it will help you find the perfect business partner.
Rule #2: Have a clear sense of ownership
When you work with business partners and team members, not only should you have a written contract outlining each person’s ownership, but, more importantly, you should clearly define what each person is responsible for.
See, the purpose of having business partners and employees is to have people who bring different skill sets to the table. With these unique skills, each person can do different tasks and start specializing so that your business can be more efficient.
Having clearly assigned responsibilities within your organization will ensure that everyone knows who is doing what, what they expect to accomplish, and when everything will be done. This helps everyone in your company to be on the same page and to share the same vision.
Rule #3: Never make promises you can’t keep
The most common mistake new entrepreneurs make, and I made this when I first started out, is that they over-promise and under-deliver. Luckily, I quickly learned that if I under-promised and over-delivered, I would have happy customers that would keep paying me for a long time.
To this day, I meet entrepreneurs who make promises they can’t keep. The funny part about it is that most of the promises they can’t keep are not important.
If you can learn to keep your promises, you’ll quickly shine in the world of entrepreneurs. Over the past 10 years, the majority of the people I ran into couldn’t keep their promises.
Rule #4: Go above and beyond to make customers happy
As I mentioned in rule number 3, under-promise and over-deliver. That’s the easiest way to keep your customers happy.
What you’ll find is that the best way to acquire new customers is to make your current ones happy. With social media, customers have much more power now than they ever used to. So, if you can go above and beyond what you have promised to your customers, they’ll gladly be willing to tweet about your business, brag to other companies about the service they received from you, and, most importantly, constantly refer you new business.
Plus, the biggest benefit of making your customers happy is that they’ll stick around a lot longer, which will increase their life-time-value. This is important as you will quickly learn that it is much harder to acquire new customers than it is to keep your current ones. So, make sure you go above and beyond for your customers.
Rule #5: There is no such thing as a 9 to 5 job
You could even say this rule applies even if you are working a 9 to 5 job, but if you are an entrepreneur, it applies even more. Over the past 10 years, I haven’t taken a vacation or a day off. Just because you’re tired of working or are sick doesn’t mean business is going to stop and wait for you to come back.
Be prepared to work 24/7 and don’t complain about the long hours. It’s life, and if you can’t do it, then you aren’t cut out to be an entrepreneur.
The best advice I can give you is make sure you are enjoying what you are doing. Because if you are, working 80-hour weeks won’t be that hard as it won’t feel like work.
Rules #6: Business and emotions don’t mix
Although I mentioned this in an earlier blog post this month, I can’t stress enough that business and emotions don’t mix. When you get emotional, you’ll start making decisions that will likely make you feel better in the short term, but it will cause your business to suffer.
Base all of your decisions on logic. Through these 4 simple tactics, you can cut emotions out of business decision-making:
- Stay grounded – when something good happens to you, don’t get too excited as someone out there is still better off than you are. And when something bad happens, don’t get down on yourself as people out there have it much worse than you do.
- Don’t hang out with emotional people exclusively – if you tend to hang out with emotional people too often, you’ll start embracing negative emotions.
- Stop bullshitting – by cutting out useless conversations in your life, you’ll also cut out unnecessary drama. The less drama you have, the easier it is to make logical decisions.
- Don’t count your chickens until the eggs hatch – just because a contract is signed or someone claims that he or she is going to pay you doesn’t mean they will. You have to wait until you have the money in your bank account, and it clears. If you start getting excited about “potential business”, you’ll often get disappointed.
Rule #7: Don’t spread yourself too thin
I’ve made this mistake one too many times over the years, and I still make it, although to a much lesser extent. By focusing my effort on one company instead of multiple businesses, I’ve been able to spend more time on my startup, which has lead to an increase in revenue.
A good example of an entrepreneur who doesn’t spread himself too thin is Mark Zuckerberg. He eats, drinks, and sleeps Facebook. He doesn’t invest in other companies nor has he tried to found other businesses. He knew that if he spent all of his time on Facebook, and nothing else, he would succeed.
Granted, if you spend all of your time on one company, it probably won’t be as big as Facebook, but you’ll have better odds of succeeding than if you divided your time in multiple ventures instead of one.
Rule #8: Never stop learning
Once I started making some money, I started to get comfortable, and naturally I lost a bit of my drive. When I made even more money, I got even more comfortable, and I started to get stuck in my ways.
At first, it doesn’t sound that bad because you think you know what’s best for your business, but sadly it isn’t always the case. You need to keep up with what’s happening in your industry, or else your competitors are going to start eating your lunch.
This happened to one of my older companies. We were able to recover and surpass our competitors again, but it quickly taught me that you always have to be learning so that you can keep innovating.
Don’t ever get stuck in your ways. And although it sounds easy not to, once you start making money, you’ll realize that you’ll change. Keep an eye out for things as you can always be learning.
Rule#9: Protect your butt
Over the past couple of years, I’ve felt I had bad luck. It seems like I have constantly been getting audited by the government, and people have been trying to sue me for random things. However, after talking with some seasoned entrepreneurs, I quickly learned that it’s a natural part of the entrepreneurial game.
See, the larger you get and the more money you make, the more people will want to come after you. The reason is simple: you’re just painting a big target on your back. And they see it as a way to make a quick buck.
Instead of stressing about these things, you need to be prepared. Make sure you are in contact with good lawyers and accountants, and you have insurance on your company in case someone sues you.
The best advice I can give you if someone tries to come after you is not to be cheap. Good lawyers and accountants cost money, and the money they cost you is a drop in the bucket compared to how much they can save you.
Rule #10: Be cheap, but not with employees
Those of you who know me on a personal level, you know that I am a frugal guy. Compared to what I earn, I don’t spend that much money. I don’t like wasting money on fancy offices, cars, material objects, or even food. But the one thing I spend a lot of money on is employees.
I’m a big believer that you have to spend money on good talent. Good employees are hard to come by. At the same time, you should also conserve money on everything else so when times get tough, you don’t have to resort to firing any of your employees.
The best part about taking care of your employees is that they’ll be loyal and stick with you for a very long time. If you are a serial entrepreneur, you always want to have the option of taking your employees to your next business, and this is only possible if you treat your employee right.
Rule #11: Perfection isn’t important, speed is
I used to be a perfectionist. I used to care what my peers thought about my company and the way I looked. But what I quickly realized was that none of them were spending money with my company, so it shouldn’t matter what they thought.
If I had focused on creating a minimal viable product and getting it out there as quickly as possible, I would have literally saved over a million dollars with my last business. And millions more with my previous ones.
Get things out as quickly as possible because if you don’t, someone else will beat you to the punch. Nothing will ever be perfect! Get your product or service out there, get feedback from your customers/potential customers, and iterate.
The rules I mentioned above are the ones I have found to work well for me over the last ten years. But instead of taking my word for it, try them out for yourself, and let me know what you think.
Rules evolve with time, and just because I have been an entrepreneur for a while doesn’t mean I know everything. Just like you, I am learning new things every day.