When starting a business, people can get caught up with the idea of needing more education. Somehow people have correlated more college with higher business acumen. Now, I loved my college, but in many ways it taught me a lot of theory but left me high and dry for some key lessons on entrepreneurship and business management. Check this article back later as I will write followup how-tos for each one of these areas.
1) How to setup a business… (yeah, really)
After going through several business courses, the topic of actually forming a business never came up. Sure, we covered basic corporate structures (LLCs, S-Corps, etc) but never learned about how to set one up and the various requirements of opening and running your business. Things like insurance, payroll, taxes and compliance were headaches awaiting me.
2) How to bootstrap your business
Every scenario used in college when referencing your own business either implied you raised millions of dollars through investors or were independently wealthy. Full time academic professors who have never been in business for themselves have little to contribute about how to fund your business outside of these two paradigms. They take for granted how hard it is to fund your own business without banks or investors and offered no teaching or theory on how to self fund your business with little or no available cash.
3) How to ignore your business plan
If you want your business to fail, simply write a business plan and try and do exactly what is written. Business plans are wild guesses that merely get you started but will never reflect how your business will develop in reality. Most business plans need to be ignored and forgotten as they will keep you chasing fairy tale ideas.
4) How to adapt, iterate and change on the fly
Since your business plan is useless 5 seconds after you go into business, you need to get used to nothing ever going to plan. Business and Entrepreneurship is about staying nimble and agile and being able to change course quickly. Business schools typically teach “build it and they will come” mentality that everything works according to plan. Hundreds of changes, iterations and tweaks are needed to get your business viable and stable.
5) How to Build a Team
When you are building a business, the personalities and past histories of the people you choose matter a lot. Your company may live and die and by who work with. There are painful lessons to be learned in selecting the wrong people to join you and work with.
6) How To Make Money
As ironic as it seems, I don’t recall a single lesson regarding making a profit. Too much of what is taught today is focusing around getting lots of momentum and worrying about profit later. Other alternatives to making a profit include selling your business to a billion dollar company. Selling a business through an acquisition should never be the primary strategy to make money. Every business should be able to support itself and actually produce a profit..
7) How to take on a competitor
Rarely were competitors and entrenched market leaders ever discussed in college. Collegiate entrepreneurship puts a great emphasis on creating something that doesn’t exist when the most viable opportunities are to create alternatives to existing solutions and to face a fierce competitor. Understanding how to take on a competitor and how to out maneuver, out perform and out price a competitor has been one of the most important things I have learned on my own.
8) How to know when to quit
People are taught that ideas always work, when in reality, they are difficult to make work even when doing all the right things. Sometimes an idea, business or opportunity needs to be abandoned and people need to move on. This is especially hard because people become so emotionally involved in their business. Sometimes it’s just time to turn a page.
9) How to think beyond textbooks
Collegiate curriculum is lopsided with outdated text books and anecdotes for business that predate the internet. Everything in business has been redefined by the internet. If your business books don’t mention Facebook or Google, you are wasting your time. It is also impossible for any book to provide solutions to all of your business problems. People need to learn how to think critically for themselves without having to rely on academia or a text book for direction.
10) How to seek advice and direction
Every business and every business owner needs help and a fresh set of eyes once in a while. You won’t be able to see every opportunity and spot every threat. You need people who have been there and done that and can give perspective beyond yours. However, you need to right people with the right abilities with the right relationship with you.
11) How to Hire (and fire)
There are certainly right ways and wrong ways to hire and fire people. Making mistakes hiring people will likely lead to you firing them. There is an art to finding people and also placing them in your business at the right time. I never was taught either.
12) How to do bookkeeping
One of the most useless courses I took was accounting. Sure it taught me for 5 minutes how to understand a balance sheet and I spent a week learning how to create a balance sheet, but the rest of the accounting principles I learned had little to do with running a business. Instead I stumbled through teaching myself quickbooks and repeatedly messed up my books because I had no knowledge about bookkeeping. (My bookkeeping software produces a balance sheet with 2 clicks by the way.)
13) How to manage customers
When you are learning about business in college, keeping and maintaining customers is completely taken for granted. Keeping and maintaining customers is foundational as your business model. If you are not careful, you will lose your customers faster than you got them. Getting a customer is often the easy part. Keeping them is difficult.
14) How to optimize your efforts
Each day when you go into your office, there are a million things you could and should work on. Knowing what is most important, what can wait and knowing how to not waste your time has been critical for me. Left to myself, I literally could spend 8 hours a day answering emails and never accomplish anything significant. Personal time management and development of business-critical priorities has been a life saver.
15) How to lead people
Effectively leading people and developing leadership qualities are rarely mentioned when talking about business in college. People don’t want to be managed, they want to be led. Your business growth relies just as much on how you lead people as your business model.
16) How to manage projects
One of the most difficult challenges in running your business is taking a huge endeavor and breaking into bite sized pieces. Combine that challenge of continual adaptation and you have a combination that can kill your business simply through mismanagement.
17) How to Establish a Work / Life Balance
Business can easily become an all consuming obsession that devours your marriage, friendships and family. Young professionals going into business need to learn the principles and practices of a work life balance in order not to become a slave to their business. Your personal life can infiltrate your business and people need to establish a healthy balance.
18) How to stop thinking and start doing
College teaches you to over think and over analyze. Sometimes the most important decision one can make is making a quick decision. It has become all too common to see a paralysis by analysis and mismanage your business through inaction.
19) How to expand or contract your business
In theory, getting an office, buying more inventory and hiring more employees always goes smoothly. In reality it rarely does. Also, I have never learned about how to downsize and scale back. Priorities, cashflow and timing are all critically important in these areas.
20) How to write
The skill I use the most every day is writing. However, I had to develop my writing skills through roundabout methods in college. Writing for business could be a semester long course in of itself. Understanding simplicity, clarity and brevity would have served me the more than any economics course that I took.