We recently celebrated our tenth anniversary here at California Counsel Group. Do we hear a collective “Woot! Woot!” from our startup brothers and sisters? We think we do! First and foremost, we want to thank everyone who has supported our entrepreneurial dreams along the way, and we are looking forward to the next decade of assisting exciting and innovative businesses to get off the ground and soar! Having ten years on the books is a great time for reflection. We want to make a real difference to our clients, just like they want to make a real difference in their communities and the world. We would like to take this opportunity to share some of the foresight we have gained, which we hope will help you learn how to become a successful entrepreneur.
How to be a Successful Entrepreneur
As with every enterprise, it all began for us with an idea. Recognizing that Startups and growth companies were underserved by the legal community, we set out to make them our niche. Over the past ten years, we have advanced our business by helping thousands of Entrepreneurs launch, fund, grow, and sell their companies. While doing so, we have seen up close the business decisions and practices that have propelled companies on the path to outstanding outcomes.
Based on our entrepreneurial journey, and those of our most successful clients, we have come to recognize that the following six entrepreneurial traits help fan the flames of Startup success:
Successful Entrepreneurs have An Eye for Talent:
Successful Entrepreneurs have something in common with Simon Cowell: they have an eye for talent. The best companies have the best people – engaged, energized and driven to grow their business. More importantly, they know how to recruit the people that the company needs. Listening carefully during the interview process, they have a keen ear for their prospects’ motivations and concerns in order to ensure that they align with company goals and culture, and then they craft an offer that creatively addresses these issues in order to successfully entice them to join their startup band.
The Gift of Gab:
They have an exceptional ability to communicate with a variety of people, ranging from colleagues and customers to lawyers and accountants. They express themselves well both verbally and in writing, and know which means of communication is the most effective to accomplish the task at hand, whether it is a meeting, a formal letter or a text. Direct and succinct, they masterfully moderate their tone for their intended audience in order to achieve company goals.
Protect the Company from Good Prospects Gone Bad:
Smart Entrepreneurs prepare to protect their company from being destabilized by unstable employment situations that may arise. Whether it is a Co-Founder making a premature exit from the company or an employee that simply does not fit, these Entrepreneurs ensure that all of the necessary contracts and documents are in place to protect the company’s business plan, Intellectual Property and value. They do not allow oversight to compromise the progress of their company.
2. How to Be a Successful Entrepreneur: Be Focused
Attentive to Details:
The most successful Entrepreneurs pay great attention to detail. They focus fully on whatever task is before them. They actually read their email messages, as well as their agreements, and they ask questions (you might be surprised how many do not). They come to meetings prepared and ready to engage, taking notes, and concentrating on the next steps. Although they pay close attention to the details, they do not get lost in them, quickly identifying those issues and decisions that are most important to the business.
Know When to Be All Ears and When to Talk to the Hand:
The best Entrepreneurs know when to listen and when not to. They surround themselves with smart and experienced colleagues and advisors. They consider their input, request clarification where needed, and resist the urge to rely on whatever half-baked “expertise” they gained on the subject by surfing the Internet. They also know when to tune out the naysayers and those who do not have the company’s best interests in mind.
Keep Their Eyes on the Prize:
They have the focus to stay on track, never losing sight of the vision that started them on their journey as it drives them toward success.
Know What They Don’t Know:
Teddy Roosevelt once said, “The best executive is the one who has sense enough to pick good men to do what he wants to be done, and self-restraint enough to keep from meddling with them while they do it.” We work with some very smart Entrepreneurs who are at the cutting edge of new technologies and business opportunities. The most intelligent ones, however, realize that they do not know everything. Following the wisdom of Teddy’s words, they recognize the limits of their capabilities and let their colleagues and advisors do what they were hired to do. They do what they do best, and they manage the rest.
Keep Their Egos in Check:
Effective Entrepreneurs possess the self-awareness to prevent their egos from growing along with their businesses. They remain open to others’ ideas and constructive criticism, knowing that they cannot afford to miss out on opportunities to improve their business. Consequently, they waste no time stroking their ego, when they could be stoking their Startups’ success.
4. How to Be a Successful Entrepreneur: Stay Organized
The most effective Entrepreneurs set both short-term and long-term goals for themselves, their company, and every member of their team. This ensures that they are focused on addressing their most pressing issues while keeping a watchful eye on their end game. Once goals have been achieved, new ones are set to keep the momentum of their enterprise constantly moving forward in order to grow to its full potential.
Plan, Plan, Plan:
…and then plan some more. These Entrepreneurs know that, although the passion for their vision is a great motivator, at the end of the day, it is careful planning that keeps their businesses afloat. They calendar business deadlines, keep their records organized, and track every detail when it comes to company ownership, down to the last share of Capital Stock and Stock Option. They have systems in place to ensure that there are no last-minute scrambles or fire drills (for example, when there are Due Diligence or information requests), because they have been taking care of business the entire time. Through these efforts, they are confident that they see the lay of the land, allowing them to snuff out fires before they became actual barnburners. Like a good boxer, the best entrepreneurs are always on their toes (not on their heels). Even if the business is running well, they are planning, evaluating, innovating, and asking how the team can do things better.
Use Technology to Optimize Their Potential:
The best Entrepreneurs lean on technology systems to plan their business activities, increase their efficiency, and communicate effectively. They are continually looking for new systems, technologies, tools, and operational processes to enhance productivity, lower costs, and improve customer service. Their savvy use of cutting-edge technology levels the playing field, allowing even a small company to be as responsive and efficient as their larger competitors.
Comfortable Working Without a Safety Net:
There is a reason that the synonyms for Entrepreneur include “daredevil,” “gambler” and “pioneer” – the prerequisite for all of these roles is bravery. Risk-taking is not for the weak-kneed. As business trailblazers, the successful Entrepreneurs jumped off the cliff and had to make sure that they avoided a nasty nosedive. Starting a business is only the beginning, and challenges, such as cash flow shortfalls and low funding interest, can pop up soon and often. The successful Entrepreneurs realize that the entrepreneurial journey is not a hockey stick – it is a roller coaster. They navigate the tough times as best they can, with the resources that they have, and hang on for the ride through the peaks and valleys of the startup adventure.
Prepared to Execute:
High performing Entrepreneurs are bold decision-makers, who do not let the pursuit of perfection get in their way. They know that good is better than perfect because you are never going to have enough information to make a perfect decision. Like Navy Seals, they instinctively follow the 70% rule – once they have 70% of the information, they make a decision and keep moving, making adjustments along the way. Effective Entrepreneurs are comfortable with a degree of uncertainty, knowing that at some point they have to stop and pull the trigger.
“Deer in the Headlights” Is Not Their M.O.:
This is not to say that they are fearless. They experience fear, anxiety, and self-doubt as we all do, but these Entrepreneurs know how to manage their emotions in order to avoid business paralysis. They evaluate the present situation, make adjustments to better the business, and keep forging ahead. Some of these Entrepreneurs won’t be successful, given the success rates for Startups. They have the mindset, however, that allows them to quickly recover from adversity and take the steps to enhance their probability for success.
6. Successful Entrepreneurs are Realistic
Mama Didn’t Raise No Fool:
“You gotta know when to hold ‘em, know when to fold ‘em, know when to walk away”…sorry, had a Kenny Rogers moment there, but his advice still rings true. The successful Entrepreneurs may be dreamers, but they also are calculated risk-takers with both feet planted firmly on the ground. Their glasses are a little more filled with realism than optimism. Optimism keeps them positive about their future outcome, but realism keeps them humble by ensuring that their decisions are ultimately driven by facts – the same facts that investors will hold them to.Fact Focused:
Speaking of facts, successful Entrepreneurs rely on their attention to detail, input from their internal and external teams and their analytical skills to determine what to do next. Once they step through their process, they pull the trigger and work hard to drive their decisions to successful outcomes.
They Are Open Books – Literally:
The best Entrepreneurs don’t hide the ball, engage in fluffy puffery, or make outlandish claims with over the top financial projections. They are too smart and know that their Investors are just as smart and won’t buy it. They present a balanced picture of the company and its prospects and challenges. They explain what’s up and layout a plan as to how they will navigate the company’s challenges to achieve targeted milestones and successful outcomes.
Know When to Pull the Plug:
A sinking ship likely is not the best outcome for the company and its owners. The most successful Entrepreneurs search for the best outcomes as their companies progress. Experienced Investors understand that Startup investing is risky business. Even if the present venture does not make it, there could be a future company with better prospects. These Entrepreneurs are focused on the best outcomes under the circumstances and realize that there could be future opportunities to bring the band back together for another entrepreneurial adventure. Even in the darkest times, they still have the foresight to determine what is salvageable before they get in the dinghy.
We understand that every company, Founder, and executive is unique and one size does not fit all. We hope, however, that you will find a few pearls in the above points, which you can add to your entrepreneurial wisdom as you continue on your Startup journey.
Finally, given that we are continuing to navigate our company while helping others start, fund, grow and sell their own, we too like to learn and welcome your thoughts about what it takes to build a successful company.