Out of all the entrepreneurs you could elicit some advice from, Guy Kawasaki is one of the few worth listening to. Kawasaki is a venture capitalist who has written 13 books on entrepreneurship, startups, and running a business. As the former Cheif Evangelist for Apple, and current Chief Evangelist of Canva, he has seen his fair share of business mistakes being over the years. Luckily, he’s generous enough to share these observations and harsh lessons with the his fans. Here are four huge mistakes Kawasaki commonly see’s when working with entrepreneurs, and how to avoid them.
Mistake 1: Scaling too fast.
One of the most common mistakes that entrepreneurs make, if not the most common, is scaling their companies too fast. You’ve got big ideas for where your company is going, and, understandably, you want to get there as quickly as possible. I hate to break it to you, but you need to focus a little more on perfecting the journey, before you screw up your destination.
While you’re in a rush to grow from a 20 person operation to 200+ as quickly as possible, adding huge customer service teams you don’t need yet and making costly operational changes that take valuable time to implement are going to bring your business to a standstill pretty quick. Your internal departments, infrastructure, as well as your product/service offerings need time to mature and adapt to new processes, technologies, expectations, etc. When you increase your burn rate, you decrease the life expectancy of your capital. The road to success is a bumpy one, and if you don’t allow your company the time and resources it needs in order to adapt along the way, you’ll never reach the dream company you’ve been envisioning, let along build a quality company with staying power.
Solution: Rarely does a company die because it could not scale fast enough. Practice patience, and focus on making your product actually ready for larger changes.
Mistake 2: Focusing on partnerships.
Partnerships tend to be a lot of smoke and no fire. If the opportunity doesn’t promise to immediately increase sales or lower costs, don’t spend time on it. You aren’t going to partner your way to a top company.
Solution: Focus on making your sales process as seamless as possible. Get to know the weaknesses and strengths within your funnel and make sure you aren’t losing out of business because you aren’t selling your solution correctly.
Mistake 3: Focusing on the pitch.
Entrepreneurs can get so caught up in raising money they forget about everything but perfecting their pitch. You can raise all the money in the world; it’s not going to build a great company if you don’t spend time figuring out how to put it to work.
Solution: Don’t lose sight of the real goal: profitability. Focus on building a solid business model that will allow your company to eventually stand on it’s own. In the early stages of a company, Kawasaki believes prototyping is your most important goal. The better you make your actual product, the sooner you can stop telling investors about your vision and actually show them.
Mistake 4: Hiring like you.
It’s a known fact that entrepreneurs tend to hire people similar to them. MBA’s hire other MBA’s. Startup people hire other startup people. Men hire men. Don’t get caught in the trap of surrounding yourself with people who are, well, you.
Solution: Hire for diversity. Hire for a team that can bring something unique to the table that you yourself can’t. The more (diverse) minds you get trying to solve a problem, the more well rounded solution you’ll come to.
It’s as important to avoid your peers mistakes as it is to try to follow their successes. The better you can avoid these common mistakes, the higher your rate of becoming one of the few you really make it.
For more from Kawasaki’s, check out a video of him sharing these and more tips. He has given this advice in speeches around the world, but each year it changes and grows a bit. What is your favorite words of wisdom from Guy Kawasaki?