The successful entrepreneur

All it takes to start a company is about 50 bucks and a visit at the local Office Depot to pick-up some generic incorporation forms. The challenging part is to create a successful (!) company. I'm jotting down a few components that haven statistically proven to stir up a much more successful company. In fact everything you are reading has been borrowed from my former professor Greg Fairchild at Darden who has studied the significance of certain aspects.

1. "Three or more": To be successful in the long-run one should have at least three founders in the company. Sure, you always want to have an uneven number of key people to avoid voting conflicts. More importantly you think about the business differently with three or more people. If you have only two persons you will talk back and forth and hear what you already know. This helps little to advance the company in the early days. With three members you will start a dynamic that can evolve into something new and better.
2. "Sales Guy": Do have an experienced sales person on your team. Why? Well, the greatest idea is worth nothing if you can't sell it. A sales person will know what it takes to sell and pitch an idea early on. He/She will help you steer into a direction that yields cash sooner than later. Please note that you should have an experienced sales person - not a person who wants to be experienced.
3. "Serial entrepreneurs": This sounds like a contradiction but the key to success is to fail and keep trying. I'm leaving out the percentages, that I don't have with me, but your chance of ending up in a profitable business is increasing dramatically with each business in which you have failed. What does that mean? First and foremost: don't give up once you fail. Second, have realistic expectations that the next or first start-up might not be it. It would be nice but it's more likely that you will succeed in the long-run. Again, don't give up.
One little chip of information at the end. So which business yields the most millionaires? Believe it or not, and without immediate backup, I remember from my MBA class that the "Dry-Cleaning-Business" brings out the most millionaires. A surprise? :-)

School of life

Award-winning British short-movie

Hiring and landlords

Whenever you hire someone be cautious if you speak to their current employer as a reference. If the candidate is a non-performer chances are that the current employer dislikes him/her and is likely to get rid of the person. Consequently, the reference would be good to expedite the transition out of the company. Therefore don't only ask the current employer but the one before (!) the current position. That employer is much more likely to give you the unbiased truth. Same holds true for renters that want to move into one of your properties. Don't stick to checking their current landlord. If they are messies chances are that their current landlord wants to get rid of them and is giving you a great reference for them.

Robert Frank @ Google

Stirring it up

"If you think you are too small to make a difference in the world you probably have never shared a night with a mosquito in bed."

He also introduced a great map that scales countries by various factors, e.g. birth-rate, GDP, etc. http://www.worldmapper.org/

Source: CEO Stonyfield Organic Yoghurt

Luck

Many years ago, the Founder of our University of Virginia, Thomas Jefferson, said, “I’m a great believer in luck. I find that the harder I work, the more I have of it.” He suggests that our efforts can at least tilt the odds, away from bad luck and toward good. Many readers are living proof of our efforts (and good results) at tilting the odds: we wear seat belts, avoid smoking, eat right, follow doctor’s orders, and so on. I agree with Jefferson that we can tilt some odds in some gambles. But as Lincoln might have said, it is not possible to tilt all the odds all the time.

Source: http://darden.edu/html/DeansBlog.aspx

Stop digging

If you dug yourself into the hole: stop digging! Then jump out.

Salt the organization

1) Use old staff - only "salt" a little bit with own people
2) This transfers culture
3) Bring people early on together (in seminars, training, leadership development sessions)

Source: Charles Cooley


1) Treat everyone the same no matter how long with the company (10 minutes or 10 years)

Source: Hugh McColl

Identify talent in acquisitions

Charles Cooley:

1) Who is in charge of what?
2) Just a small group discusses (e.g. 4 people)
3) Who is critical in the new organization?
4) Then those people do the same with the people beneath them... (this quickly creates a working team)
5) Do Talent planning (right at signing the deal)
6) Background, results, can they relocate?, interviews with key people
7) Lock people in
8) Don't be arrogant in hiring & firing people

Negotiation

Advice from Hugh McColl:

1) Price is there but its about the positions of directors and board members
2) What can we afford? What does it take to get there?

Tactis:

1) Don't let get Investment Bankers get in between the party
2) Wonder of it all approach: try to figure out what is in for everyone
3) Deal with everything about what they care (price, pride, people, etc.)
4) Don't include an offer
5) Sit next to people not across people (except for lunch and dinner)
6) Use less hostile language
7) Use artifacts (like a baseball hat) to make a negotiation special and to "pitch"

Give and Take

1) Gave up chairmanship title to other and give him the same salary! (= keeps pride)
2) Don't give up CEO
3) Give up all other titles (=costs nothing) but keep the CEO - this removes a barrier
4) Kee Surviving, Control and Profitability
5) If they want higher price then they have to give up something, e.g. have to find more earinings in the target
6) One always has to give up board seats. Have criterias in place for replacement.
7) Grow board members like accordeon but then shrink over time again.
8) Board always grew with more and more mergers

Networking advice

-- Never keep score. If your interactions are ruled by generosity, your rewards will follow.
-- Your relationships with others are your finest, most credible expression of who you are and what you have to offer.
-- Give your time and expertise freely. It is like Miracle-Gro® for networks.
-- The best time to build a network is before you need it.
-- Do your homework. Never pick up the phone or plan an introduction before knowing as much as possible about your contact.
-- There's no need to ponder who picks up the lunch check. Generosity is the key to success. -- With networking, it's better to give before you receive.
-- Don't come to the party empty-handed. You're only as good as what you give away.
-- Social scientists are proving that people who are more connected with other people live longer and are healthier.

Source: Never at alone

Mozart on writing symphonies

“Well, I always could, and I suspect I wasn’t the only one. It’s not something that can be passed on from one person to another. I remember, late in my short life, an even younger person came to me and said, ‘Maestro, I want to write symphonies. Can you give me some advice?’ ‘Well,’ I said, ‘my first piece of advice to you is that you wait until you are a bit older. You are too young yet to write symphonies.’ ‘But Maestro, you were writing symphonies when you were nine years old!’ ‘Yes, and I was not asking advice, either.’”