Style My Soul Explores ...
"What is one monumental mistake you made as an early entrepreneur?
What lesson did you learn from this experience?"
Here are 7 lessons these seasoned entrepreneurs shared from their mistakes:
Outsourced to the Wrong Company and Almost Gone Bankrupt
Early on in my entrepreneur journey, I decided we needed to outsource our marketing effects. I thought I did my homework on selecting the correct company, but my mistake was I wasn’t educated enough about the projects they were doing. I didn’t know the correct questions to ask and It was so out of my current skill set I trusted that this outside company that they were doing the right thing and didn’t monitor the work being done. I paid for months of their service to understand they weren’t experts at marketing and I was the one paying for them to learn. This almost bankrupted my newly founded company. I did learn a very important lesson in business. You need to educate yourself enough on all topics to make sure you have the right people in place. You don’t need to be the expert, but need to have enough knowledge to see the red flags and fix this issue before it causes too much damage to your business.
Evan McCarthy, SportingSmiles
Learned to Help My Team Flourish
Although many monumental mistakes come in actions, mine came in the form of beliefs about my role, which stifled innovation by thinking I was supposed to direct my talent rather than fostering it. Early on in my career, I felt that if I was not an expert on every topic, it would diminish the respect my team had for, which in turn, led to me to slow down the process of innovation by not recognizing my weakness. Yet by watching creativity and productivity diminish, I soon realized that a leader’s job was not to showcase their talents but to make sure their team puts theirs on display. Therefore, by hiring towards my weaknesses, and then allowing my team to flourish, rather than trying to make my input as being seen as of equal value, they were able to utilize their strengths to the benefit of everyone. Since that time, I have held the view that my job is not to be the star but rather to be the person that finds them.
Adelle Archer, Eterneva
Don’t Forget to Form a Legal Entity
One of the biggest mistakes I made early on in my first venture was failing to form a legal entity. I had a great business concept and just started up operations. It was great — until it wasn’t. At some point in the first 6 months of doing business I got a cease and desist letter from another company, claiming I was infringing on their IP. Of course, I wasn’t infringing, but the letter scared the hell out of me. If I got sued, everything in my personal life was vulnerable. Because I never formed an LLC, if a lawsuit followed and I was found liable, I could lose everything. So I immediately ran out and created an LLC. But the problem is that once you start a business and have ongoing operations, it’s really hard to shift everything over to an entity. It was a massive headache and cost me much more than it needed to. That was a rough lesson to learn, but important all the same. Every time you start a new business, the first thing on your list should be to create a new entity.
John Ross, Test Prep Insight
Thought I Had No Direct Competition
I remember when I first started my business, thinking that I had no direct competition. I was in the market selling exotic flowers online and there wasn’t another company that did what I did. Or so I thought. It turns out there was a very well-funded company with much more experience than me who had the same idea. And they were able to undercut my prices and put me out of business in just a few months. It was a very costly mistake that taught me a valuable lesson: always be aware of your competition, no matter how big or small you think they are. Nowadays, I make sure to do my research and keep a close eye on the landscape so that I can adjust my strategy accordingly. Having this awareness has helped me avoid making the same mistake twice.
Lorien Strydom, Financer.com
Beware of Hiring Friends
Because I’ve always been empathetic, I’ve always wanted my friends to have what I do, and as a result, I’ve hired a few of them to work for my newly launched company. It turned out to be a bad idea which affected the company badly. Later, I came to understand that some of the best firms started as a partnership between friends. Despite how motivating these stories are, hiring friends often means skipping over the necessary skill sets in favor of working with someone you already know. I made the same mistake, which had a negative impact on the most important work at first. Entrepreneurs should carefully analyze resumes and select new team members based on variables including talents, abilities, and culture fit, whether they are friends or strangers.
James Scott, OzBox
Take Your Finances More Seriously
My first company sold $25 million in total on Amazon over a 5 year period. We were growing fast, I was in my early 20s, and we didn’t take our monthly bookkeeping and finances as seriously as we should have been. It led to poor financial management that cost us as a company and as founders. I learned the importance of having your books in order each month and using that financial data to influence how you continue to grow. Taking that lesson, I was able to scale my second company, FreeUp.net, to 8 figures per year and a successful exit.
Connor Gillivan, EcomBalance
Don’t Hesitate to Reinvent Your Business
My co-founder and I created a startup that operated as a direct-mail prescription discount program. The idea seemed iron-clad at the time. Prescription discount cards were a huge hit, especially with seniors. We earned a loyal customer base, but we were constantly in break-even purgatory and that continued for years. By the end of 2019, things started to look grim — and it quickly got worse courtesy of the covid-19 pandemic. We should’ve realized sooner that shifting to a digital-first model would’ve raised our ceiling tremendously, but we wouldn’t take the plunge. We finally did — after a few months of not being able to afford to pay a single salary. Our business was resuscitated after that shift took place. It was a move that we almost waited too long to take. Today, we’re more profitable than ever. The lesson: Don’t be afraid of reinvention.
Erik Rivera, USA Rx