By Charles Pittaway, Managing Director of Netcash
Charles Pittaway shares his other 5 tips for surviving the entrepreneurial experience.
I love working in flat organisations without lots of structure and hierarchy – it’s one of the reasons I started Netcash. But it would be naïve to think we could survive without some structures and channels for making decisions. When people start looking for direction, they need to know where it’s coming from.
6. Isolation at the top
Even if you keep an open door and employees know they can give you honest feedback, sometimes you need a trusted advisor outside the business. Your lawyer or accountant is not necessarily the right person – how many of them run their own businesses? Find a mentor or peer group of other entrepreneurs who have faced the same issues.
It’s tempting to fund a business with debt and keep 100% ownership – but very dangerous. Your bank is not your partner and it has no real stake in the success of your business – if things go wrong it’s got your house, your car and everything you own to fall back on. An equity partner, on the other hand, has got to pitch in to make the business work. As the saying goes, it’s better to have 50% of something than 100% of nothing.
8. Too many eggs in one basket
It’s great to have a bread-and-butter client, a big account that keeps the money rolling in. But if you lose that client, your entire business could be at risk. Keep your client base as diverse as possible – and if you can’t, make a plan for what you will do if you lose that account.
9. Competitive advantage
One successful product or service doesn’t make a business. If you really have found an attractive market, you can bet there are competitors looking to take a piece of it. Keep on researching, developing, introducing new products and new levels of service. Make the competition scramble to keep up, rather than digging yourself a static position and defending it with everything you’ve got.
10. Moving on
At some point in the life of almost every business, the original founder needs to step aside and let someone else manage it. The skills and attitudes needed for a successful start up are very different from those needed to manage a stable, mature company. If you stay on past your sell-by date, you run the risk of poisoning the business. Rather get out while you’re ahead and either enjoy the rewards of success, or move on to a new challenge. Then read this advice all over again.