I’ll be the first to admit that, at 22, I was in no position to run a business. I was fresh out of college and thinking about signing up for law school. I had no idea that, in a few more years, I’d be thinking about mortgaging my house to buy a company and make the leap from IP lawyer to executive. That transition wasn’t easy, and there is plenty of business advice I’d give myself if I could go back in time and let 22-year-old me know what was on the horizon.
Pay attention to long-term return on investment.
When I was a lawyer, a return on investment was assumed. We normally took cases that made the firm money – that was straightforward enough. But when you run a business, maintaining a positive ROI is a lot more complicated. It isn’t about money-in, money-out. A good ROI could be defined as more exposure, a bigger web presence, or a better reputation. All of these factors play into how much money the business brings in, but you don’t see hard results right way. One of the best pieces of business advice I’ve ever received is to always look at the long-term. Long-term thinking staves off stagnation, and keeps a business’s doors open. You can cut corners to make more money in the short-term, but that may damage your reputation and cost you in the long run.
Learn to downsize.
When I bought MyCorporation, I inherited a team that had grown way too large for the company. One of the main problems I saw in the business before I bought it was that it had become too sluggish, but I didn’t know how to downsize. I wanted everyone to stay on. Unfortunately, that meant the business didn’t make the progress I hoped it would right after I bought it. Owning a business means making tough decisions. So, my next piece of business advice to myself would be to learn how to make sacrifices for the good of the company. I knew MyCorp couldn’t continue with so many employees, so I hardened up and downsized where I had to. If running a business was easy, everyone would do it, and it’s important to let the overall health of the business inform your decisions.
Control, without being controlling.
A good business owner needs to know how to control a business without be controlling. I’ve always liked the business advice ‘lead from within, not from out front.’ You need to empower and trust your team to keep the business humming without you micromanaging. Businesses are like living creatures – they grow, evolve, and transform. When most entrepreneurs start their business, they are their only employee, so they have to do everything, from sales to accounting to marketing, on their own. As the business grows, they can hire people, but a lot of business owners have trouble stepping back. Eventually, owners have to realize they are there to direct the company and make hard choices, and they need to trust their team to do everything else. You still need to know your numbers and have an active role in the business, but if you try to run everything, you’ll eventually crash and burn.
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