I am proud to have learned such a great deal from my failures, and the fact that I get to share them—and, more important, the hard-knocks lessons learned—with a worldwide audience is a real thrill. After all, what's the point of ending up in frivolous litigation, nearly losing your shirt, pitching VCs for tens of millions of dollars with no revenue model, or being forced to move back in with your parents if you can't have a few laughs as a result, right?
And with that, here are my top 10 lessons learned from my past failures that were well worth the price of admission (well, after I survived them, that is). Feel free to check out even more in Never Get a "Real" Job.
10. No revenue, no business. Period. Build a sustainable business for yourself, and not one based on hypothetical acquisitions or imaginary investment capital. If your business can cut it, you may be able to buy other companies down the road or raise VC. But treating either path as a guaranteed strategy is simply stupid. Bottom line: Stop thinking about many tomorrows from now, and focus on today. Cash flow, or die.
9. You are not special, a winner, or guaranteed squat (and neither is your business). If you are human, guess what? You are still bound by the rules of Darwin's theory of evolution or, at the very least, Murphy's Law. The worst thing you can do is fall for your own b.s., so stay focused, stop thinking you are a winner because you're excited and think your idea is brilliant, and go kick some real ass.
8. How many things can you do perfectly? If your answer is anything other than one, and you are a small start-up on a shoe-string, guess what? You are an idiot. Rome wasn't built in a day, neither was Google. Both were built brick by brick, scaled and then, and only then, did they diversify. Keep your business plan simple, because if it's not simple, you're dead.
7. Traditional business plans will bankrupt you. Don't get stuck in analysis paralysis! Business planning is not a revenue generating exercise. Execution is where the money is at. Write something short, sweet and to the point and get on with it. I always preach about my One Paragraph Start Up Plan as the best way to get started.
6. The worst case scenario is the only scenario. If you project 100 customers, you might get 10. If you predict a deal to close within 2 months, it might close in 12. The point is, you always need to be thinking about back up plans—and sometimes—back-up plans to your back-up plans. Don't rely on one way to do something, think about multiple paths. Cover yourself by thinking about alternatives at every turn and you'll become a much stronger decision maker.
5. Divide your "lowest" financial assumptions or expectations by 4. Anything you think you will earn before you execute, well, probably won't happen. Financial forecasts are like little gremlins that sit on your shoulders whispering sweet nothings in your ear about upward climbing bell curves. Don't get stuck on a grandiose financial milestone. Focus on growing organically and covering your basic life expenses before you worry about a six-figure salary or ten-digit company revenues.
THE AUTHOR OF THIS BLOG ARTICLE IS NOT A LAWYER AND HARVARD BUSINESS SERVICES, INC. IS NOT A LAW FIRM. THE ARTICLE ABOVE IS NOT INTENDED AS LEGAL ADVICE AND SHOULD NOT BE TAKEN AS LEGAL ADVICE. THIS SHORT ARTICLE IS STRICTLY TO MENTION SOME ASPECTS OF DELAWARE’S CORPORATION LAWS AND/OR LAWS RELATING TO OTHER FORMS OF ENTITIES WHICH YOU MAY NOT BE FAMILIAR WITH. WE RECOMMEND THAT YOU CONSULT WITH A LAWYER BEFORE FORMULATING A STRATEGY WHICH WILL BE SUITABLE FOR YOUR SPECIFIC CASE.