Confession time. What's the worst business mistake you've made? I'll go first. In the '90s, I held on to too much of the internet company I founded. We were offered millions of dollars, but I took less money to keep a bigger chunk of ownership. We blew through the money faster than we grew. Lesson learned: Better to own a small piece of a large pie than a big piece of nothing.
For Diane Kuehn, 41, president and CEO of online marketing companyVisionPoint Marketing in Raleigh, North Carolina, offering stock options to her employees was both a legal and financial disaster. "I thought that in order to bring on a higher level executive, it would be necessary," explains Kuehn, who implemented stock options three years after founding her million-dollar company.
Her painful "aha" moment came when the employee she lured with stock options left and a legal battle ensued to buy the stock back. Kuehn recommends having your stock buy/sell plan finalized before discussing it with employees--and using a good lawyer to set things up.
Fear led Michele DeKinder-Smith, 39, to make her big business mistake. As president of Tampa, Florida-based marketing research firm Linkage Research and Consulting, she hesitated to bring on staff to help grow the company. "I found myself working incredibly long hours--over 80 a week--and feeling stressed," she says. "My life got out of balance, and I was juggling so much that I was terrified of letting a ball drop and losing some key business as a result."
DeKinder-Smith turned to a professional coach as well as friends and advisors to guide her through the process of hiring her first employee. She knew technically how to hire someone, but emotionally she needed the support.
Her first hire ended up being a bad one, but from that experience, she learned the importance of clarifying expectations upfront. She now has four employees, and revenues doubled last year to nearly $1 million.
Laura Howard, 40, founder ofLaloo's Goat Milk Ice Cream Company in Petaluma, California, was in such a rush to be first to market, she didn't bother to proof the labels on her first batch of ice cream. "We missed an omission of egg yolks on the ingredient label on the package--all 10,000 of them," she admits. "I had to resticker each pint by hand. Because the company was new, I didn't trust anyone else to do it because egg yolks are an allergen and the result could've been a lawsuit."
Howard personally delivered the entire lot for the next three months, hand-checking every case. Her clients were so impressed with her efforts, she won their respect. Her 2007 revenue has already hit $1 million, and it's expected to double in 2008.
Chalk this next story up to the saying, "Know what you don't know."Denise Solay, 50, a jewelry designer in New York City, recalls when she first started her business and hired the large accounting firm handling her husband's company's taxes. "They collected my information and sent me a package of forms. I was told to sign them and file my taxes," she says. A few months later, the IRS began sending threatening letters stating they had no record of her tax payments. Solay had taken the accountants literally and filed the tax forms--along with the check--under "T" for taxes in her new file cabinet. Luckily, she was able to pay that year's taxes without penalty.
Whatever your faux pas, the first step in fixing it is admitting it. Then, according to Marsha Firestone, founder ofThe Women Presidents' Organization, have faith in your business acumen and ability to fix the mistake. "It's not what mistake you made that's important; it is how you move forward and compensate for the mistake." Self-awareness is the key to moving forward.