13 Important Lessons for New Entrepreneurs
Posted on August 25, 2014 by Gregory Diehl, One of Thousands of Entrepreneurship Coaches on Noomii.
Many entrepreneurs realize years too late into their journey that some core principles are missing from their approach.
1. A business is a system of trading value for money.
Value is subjective. You have to learn to look at things through other people’s eyes. What you value is not necessarily what they do (though it could be a good starting place to build from).
2. “Entrepreneurship” is just a fancy word for creating a new system of value exchange.
Working for someone else means you are just playing a role in their system. This isn’t a bad thing. You can learn important things, and make a good amount of money doing this. An entrepreneur is someone with the personality to take charge and create new things.
3. You only need two basic traits to be an entrepreneur:
a. cleverness (intelligence + creativity)
b. boldness
You have to be clever enough to try new interesting things. You have to be bold enough to risk failing. Even in failure you learn important things. Risk is the price of entrepreneurship. Nothing is guaranteed. You could get very rich or go broke.
4. If you’ve ever wished someone would “give” you a job, forget most of what you know about making money.
You have to stop being completely passive/responsive to what other people want. Be proactive. Take the initiative to offer things without being asked. You need to adopt a mindset of helpfulness. Money is all around you. Everyone who participates in an economy is exchanging money every single day. You just have to find some way to insert yourself into that flow and reap the rewards.
5. Identify your strengths and weaknesses right now.
No one is good at everything, but everyone is good at something. Be specific in what you can do. You will not make money being just an all-around nice, smart, talented, or passionate person. My biggest core strengths are critical analysis and communication. I make that a crucial part of everything I do, and make it obvious to everyone who works with me. But I can’t do visual design to save my life, and I am terrible in uncontrolled social settings. What about you?
6. No matter how good your idea or skill is, you have to know how to sell (or work with someone who does).
“Selling” is the art of convincing someone to do something they would not have realized they actually wanted to do. It is not adversarial. If you trick someone into buying something from you, you are a conman, not an entrepreneur. Be honest with your prospects. If you have to lie, you are either in the wrong business or are talking to the wrong people.
Ignore your assumptions about why people will buy from you. Try to identify every individual’s desired respective goals by asking compelling questions. Remember: you are trying to help them do the right thing for themselves, and you can’t do that until you really step inside their shoes and figure out what they need.
7. Turn broad ideas into bite-size, consumable packages (products).
You have to be able to explain what you do, how you do it, who can use it, and what it does for them in a paragraph or less, preferably even a single sentence (“elevator pitches” and “taglines”). A successful business usually consists of several related products and services which complement or improve upon each other (which enables “cross-selling” and “upselling”). The worst thing you can do is get so caught up in all the possible applications of your ideas and skills that you never even get started.
8. The most important question you will ever be asked is: “Why should I hire you?” or “Why should I buy your product?”.
Generic answers are worthless (e.g. no “because it’s good”, “look at my portfolio”, “highly qualified”, or “exceptional service” answers). Say something other people cannot say, or have not thought to say. The key is to state unique or at least uncommon value and attributes. Give them something to identify you with, and something that seems particularly pertinent to their situation. The right answer to this question can close an enormous amount of deals right on the spot.
9. Figure out a compelling unique selling proposition (USP) as quickly as you can.
What makes your business unique will generally be a combination of four basic things:
1. The specific problem you solve.
2. The specific way you solve it.
3. The specific kind of person you solve it for.
4. Who you are (your personal brand) that is selling it.
The right combination of these four elements forms the beginning of your company narrative.
10. Pick a business idea that is in line with your core passions, values, and interests.
If you don’t know what these are, keep trying different things until you figure out what you like and what you don’t. The last thing you want is to spend your life building a career out of something you don’t genuinely enjoy. We all need to get by in the meantime, but there is a time and a place for making enough cash to eat and another for building a new lifestyle. Find a way to relate that passion to a common problem you’ve noticed a certain kind of person has.
11. Develop a Minimum Viable Product (MVP) ASAP.
An MVP is what officially makes you a business, and what makes you profitable. It has to be a closed system of value to count as a product. It cannot be the setup for value (though it should lead into other avenues and instances of value). A restaurant’s MVP is whatever the cheapest item on their menu is. In most cases, that means the act of eating the item. For a piece of art, seeing it would be the completion of the transfer of value. For an information product, it would be learning a new concept.
12. Always be learning new things about your industry and entrepreneurship in general.
You won’t know everything you need when you start. There is no perfection. You can only learn to optimize what you do as you go along. Even when you get the basics of supply and demand down, other people know tricks you don’t. Critical feedback from knowledgeable sources is crucial. Join a mastermind. Read blogs. Plead with successful entrepreneurs to rip your idea and system apart the best ways they can.
13. Apply what you learn as soon as possible, even in insignificant ways.
Your brain is not a computer hard drive. You can’t just download tons of information in one sitting. It learns and remembers by putting things into action. It could be as simple as writing it down. For me, it’s explaining how things work to other people. If you already have a business, a freelancing practice, or a “job”, implement new principles as soon as you can in whatever your role is. Learn how your brain learns, and then exploit (hack) it.
