7 Good Entrepreneurial Habits That Turn Bad
Good entrepreneurs are all about managing change, but too many forget that they have to change themselves as their dream evolves from a startup to a scalable business. Most begin by doing the product development, marketing and sales alone, but struggle making the transition to hiring and coaching others, defining repeatable processes and focusing on future strategy.
For example, there once was a social network called Friendster, often credited with starting the social networking boom way back in 2002. Many pundits feel entrepreneur Jonathan Abrams failed to get the professional management and resources he needed to scale, including turning down an offer from Google for $30 million and was run over by Facebook, a later competitor.
The challenge is to move from doing the work to managing the work and leading others. It doesn’t matter how dedicated and capable you are, there are only so many hours in a day, and as your business scales, you need to count on others for help. Certain habits, including key ones below, served you well in the early days, but can easily lead to your demise as the business grows:
1. Continuing to act as a control freak.
When the plan is all in your head, and elements are undefined, it’s important to monitor every step of the progress, in order to make quick corrections. When the business starts to scale, you need documented processes and people with the right skills and training who can do the right work without you.
2. Trust your gut, and ignore naysayers.
Now you have real customers who can quickly turn off hundreds of potential customers if you ignore their feedback. Now it’s time to make decisions from analytics, customer reviews, and financial results, rather than letting your passion and perseverance convince you that customers will soon see it your way.
3. Nurture loyalty and trust only with a core group.
As your business grows, so must your circle of relationships. Your trusted circle must now be expanded to include new partners, customer advocates, and peer business executives. You can’t demand total loyalty from all, so you have to learn to accept criticism without being defensive.
4. Happy to work and live on your own terms.
Many entrepreneurs gave grown to prefer the relative quiet and isolation of their garage, and their ability to set their own schedule. As an executive, the business will demand your attention on a 24-hour basis and you must interact with employees and customers every day to keep the momentum going.
5. Love to solve tactical problems and let strategy evolve.
Investors and alliances are looking for partners who have a strategic focus, and can find the right consultants to solve their tactical issues. Strategic thinking reduces tactical problems as the business grows, so great entrepreneurs learn to change early from tactical to strategic thinking.
6. Take pride in your ability to get things done yourself.
That ability to tackle any challenge personally, and get it done, serves early entrepreneurs well. As the business grows, you must learn to hire and train employees, and utilize outsourcing in non-core areas to keep up with the volume and detailed expertise required. It’s a big change.
7. Limit your scaling efforts to organic growth.
When you build a great solution or product, all you can think about is shipping more volume of your product to a larger audience. That’s necessary but not sufficient to scale most businesses. You need to nurture non-organic growth partnerships and acquisitions to maximize your valuation.
Some founders don’t want to change, or simply don’t enjoy the executive role. The smart ones in this category know when it’s time to bring in an outside more experienced CEO, or step aside voluntarily when investors start demanding new management disciplines and metrics. Others won’t adapt and won’t step aside and cause major or terminal damage to their business.
Thus my recommendation to every entrepreneur is to first take a hard look at their own strengths and weaknesses, as well as what they enjoy doing. Try to capitalize on your strengths, rather than trying to fix all your weaknesses. Maybe that means swallowing your pride and stepping aside as your business grows, or bringing in a new partner with the commensurate skills. This life is too short to go to work every day unhappy and struggling. Not every entrepreneur needs to scale.