5 Things Every Great Entrepreneur Needs To Know
Originally posted on Business Insider by Lucas Carlson
The other day, a friend of mine asked me whether CEOs were born or made. I said, “That’s kind of like asking if Jolly Ranchers are grown or made. CEO is a very unnatural job.” — Ben Horowitz
What do great entrepreneurs know that we don’t?
It is a common myth that business geniuses like Walt Disney, Richard Branson and Steve Jobs had it all figured out from the start. Although they appeared to have a natural built-in sense for how to build businesses that changed the world, they all learned hard lessons along the way.
So what are the things Ben Horowitz, Steve Jobs, Walt Disney and Richard Branson know that so many of us have not yet figured out? Let’s explore five of them right now.
1. A Large Platform Creates an Unfair Advantage
What’s the biggest difference between Disneyland and Knott’s Berry Farm just a few miles away? Mickey Mouse.
Walt Disney had a compelling and unfair advantage to secure more money from banks to build a bigger and more expensive amusement park than anyone had seen before. What persuaded bankers to back his idea? Walt Disney had a captive audience of fans who already loved what he did and wanted more of it. Disneyland wasn’t just an amusement park; it was an extension of the platform that originated with Mickey Mouse and expanded into countless beloved characters.
Can you create a platform of fans (of you and your mission) before you even launch your product or service? (Hint: try starting with just a blog and a mailing list and see what you can do.)
2. The Secret to Creating Great Products is Deep Empathy with Your Customers
Steve Jobs famously told Business Week, “A lot of times, people don’t know what they want until you show it to them.”
In other words, you can’t always rely on your customers to tell you what they want. That’s why great entrepreneurs cultivate deep empathy with their customers. They intimately understand their hopes and dreams, as well as their fears and frustrations, and imagine products and services that directly address those needs better and more efficiently.
Can you make a list of 50 hopes and dreams, and 50 fears and frustrations that your customers have? How does your product help your customers achieve their dreams and protect them from their fears? Are you telling them this story on your website/blog/social media/mailing list, or just listing your product’s features?
3. There is Less Personal Risk to Starting a Company Than It Appears
Many aspiring entrepreneurs think starting a business is a huge personal risk. That if it fails, it will ruin their reputations or ruin them financially. The truth great entrepreneurs know is that if a business fails, you can always just get a job.
This knowledge helps great entrepreneurs manage their fears. They still feel fear, but they can recognize the irrationality of it and choose to continue on regardless. They no longer use lame excuses to not even try.
Closing a business does not on its own ruin a founder’s reputation. If the founder acts unethically or immorally in the process, that will clearly hurt their reputation. Though the death of a business is a difficult process, it is not a career-ending one.
Can you imagine a worst-case scenario and create a plan for what you would do if it ever happens? Then stop using worst-case scenarios as excuses.
4. Your Blind Spots Can Sink You (So Find Out What They Are)
Just like driving a car, you can’t always see everything around you when you are running a business. You might not realize how your behavior is affecting employee morale, or how your best intentions are actually ruining your company.
Ben Horowitz talks about many of these common blind spots in his blog and book The Hard Thing About Hard Things. For example, he talks about what to do when a key employee comes to you asking for a raise. If you do not know what to do in that situation, you might quickly acquiesce and inadvertently create incentives that turn your company into a political nightmare. (Note: Ben’s advice in this situation is to hire people with the right kind of ambition, build strict processes up front to handle sticky situations and never make exceptions.)
Not knowing how to properly handle difficult situations is a blind spot, and unless you surround yourself with mentors and people who have been through this many times before, you are setting yourself up to fall into these common traps.
Can you ask mentors, friends and colleagues, “What are my blind spots?” If you don’t ask for negative feedback directly, people won’t feel comfortable giving it to you.
5. Startups Are All About Stories and Relationships
Your product is not your company. When you buy an iPhone, you are not just buying another phone. You are buying into the Apple lifestyle. You are becoming a part of a larger story of innovation and technology. You are building a relationship with a brand that can last a lifetime.
The best companies and greatest entrepreneurs in the world know this and use it all the time. Richard Branson’s companies are infused with the “Virgin” mentality that they will provide better service to make the best experience possible for their customers. That’s their story. When you buy Virgin, you are buying into that story and creating a relationship with that brand.
What story does your startup tell? Can you create deeper relationships with your customers through helping them understand the larger story that your brand fits into?
The Biggest Secret Of Them All
Knowing and understanding are quite different. Knowing comes from reading information in blog posts, or books, or listening to podcasts. Understanding comes from trying to practice the knowledge, and usually failing at it a few times over.
If there is one trait all great entrepreneurs share more than any other, it is that they are incessantly driven to turn knowledge into understanding. Challenge yourself to put these five ideas into daily practice and take note of what works for you and what doesn’t. If you cultivate that burning desire and turn knowledge into understanding, you will be walking a path beaten by many great men and women before you.