I recently spoke at an event for "Entrepreneurs".
It was put together by a government Enterprise agency and the invited delegates were all going through a process of thinking about starting a business or were actually starting up their new business.
When my time came to talk, I apparently threw the cat among the pigeons by telling them to stop spending so mch time, effort and money on "setting up" their business and to get on with selling something.
The Host/compare threw me a look as if to say "what the hell are you doing?" and I found out later why. He had spent all his time (and the last few weeks) on teaching them how to set up their business and here was I, an invited speaker with years of experience, telling them the opposite.
He wasn't too pleased and neither were some of the delegates. I know that because they came up to me at the end and told me so.
So what was the big deal...what did I say that was so wrong?
Before going into that, let me ask you a question. Have you read the Book "Freakonomics"? If not, get yourself a copy.
The tag line to the book is, "The Hidden Side of Everything" and basically the writer(s) go on to explain (and show with statistics) why things and activities that we thought were normal are not actually normal at all.
Some examples they give are that children are safer playing in a friends house if the parents have a gun rather than playing in a house with a swimming pool. Sports cars are safer than SUV's. You are safer driving home drunk that leaving the car and walking.
So far so controversial...so what's that got to do with setting up a business?
Here's the "so what"...every business that you start is really two businesses.
There is the business that you set up to do, the service you provide or the products that you make. That could be adjusting spines as a Chiropractor, cleaning cars or writing legal contracts. It's too easy to say that "I'm a dressmaker, so I need to spend my time making dresses"
The reality is that you need to spend time selling your services or products. In fact you need to spend a lot more time selling than anything else...80% of your time to be exact. The old Pareto principle of 80/20. The majority of time in selling and the balance in setting up the business.
But most people do the opposite.
They spend nearly all of their time, effort and money on things such as setting up the office, getting a website, getting a logo, getting headed paper and business cards, software for the computer, printers, mugs and pens with logos on them and so on and so forth. Trying to get things right before they sell anything.
Wrong, wrong, wrong!
You don't need to get it right, you need to get it going!
And the only way to get it going is to get some sales. In fact do nothing else until you get those first sales.
No matter what line of business you are in you need to get sales. As a lawyer you need some clients, they need contracts, wills, shareholders agreements, new companies set up, intellectual property licences, whatever. Selling should not be beneath you. If it is, get a job.
How do you know if your business or product is any good? The only way to find out is to find out what the customer thinks. Are you giving value? Value is only determined by the customer, not you.
If your product or servcie is any good they will buy and buy again and then (you hope) refer you to friends or colleagues and they will buy from you.
When the money comes in you can rest assured that you are doing something right and then you can start getting and paying for all the websites and logos that you think you need. But customers don't care about the "changes and improvements" they don't want to hear the childbirth, they just want to see the baby.
Your priorities are therefore:
1. Sell
2. Push to make more sales
3. Improve your products or services and sales
4. Organise yourself
Then start back at number 1.
It was put together by a government Enterprise agency and the invited delegates were all going through a process of thinking about starting a business or were actually starting up their new business.
When my time came to talk, I apparently threw the cat among the pigeons by telling them to stop spending so mch time, effort and money on "setting up" their business and to get on with selling something.
The Host/compare threw me a look as if to say "what the hell are you doing?" and I found out later why. He had spent all his time (and the last few weeks) on teaching them how to set up their business and here was I, an invited speaker with years of experience, telling them the opposite.
He wasn't too pleased and neither were some of the delegates. I know that because they came up to me at the end and told me so.
So what was the big deal...what did I say that was so wrong?
Before going into that, let me ask you a question. Have you read the Book "Freakonomics"? If not, get yourself a copy.
The tag line to the book is, "The Hidden Side of Everything" and basically the writer(s) go on to explain (and show with statistics) why things and activities that we thought were normal are not actually normal at all.
Some examples they give are that children are safer playing in a friends house if the parents have a gun rather than playing in a house with a swimming pool. Sports cars are safer than SUV's. You are safer driving home drunk that leaving the car and walking.
So far so controversial...so what's that got to do with setting up a business?
Here's the "so what"...every business that you start is really two businesses.
There is the business that you set up to do, the service you provide or the products that you make. That could be adjusting spines as a Chiropractor, cleaning cars or writing legal contracts. It's too easy to say that "I'm a dressmaker, so I need to spend my time making dresses"
The reality is that you need to spend time selling your services or products. In fact you need to spend a lot more time selling than anything else...80% of your time to be exact. The old Pareto principle of 80/20. The majority of time in selling and the balance in setting up the business.
But most people do the opposite.
They spend nearly all of their time, effort and money on things such as setting up the office, getting a website, getting a logo, getting headed paper and business cards, software for the computer, printers, mugs and pens with logos on them and so on and so forth. Trying to get things right before they sell anything.
Wrong, wrong, wrong!
You don't need to get it right, you need to get it going!
And the only way to get it going is to get some sales. In fact do nothing else until you get those first sales.
No matter what line of business you are in you need to get sales. As a lawyer you need some clients, they need contracts, wills, shareholders agreements, new companies set up, intellectual property licences, whatever. Selling should not be beneath you. If it is, get a job.
How do you know if your business or product is any good? The only way to find out is to find out what the customer thinks. Are you giving value? Value is only determined by the customer, not you.
If your product or servcie is any good they will buy and buy again and then (you hope) refer you to friends or colleagues and they will buy from you.
When the money comes in you can rest assured that you are doing something right and then you can start getting and paying for all the websites and logos that you think you need. But customers don't care about the "changes and improvements" they don't want to hear the childbirth, they just want to see the baby.
Your priorities are therefore:
1. Sell
2. Push to make more sales
3. Improve your products or services and sales
4. Organise yourself
Then start back at number 1.
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