As an entrepreneur, you’re going to lose money and make mistakes, but today, I’m going to help you avoid making the most common ones. Today I’m going to share with you seven lessons I learned from losing a million dollars before I was 21. These are the business tips I wish I knew when I was a young entrepreneur
RESOURCES & LINKS:
7 Things to Do Before Becoming an Entrepreneur (video): https://youtu.be/N6V7gXaz_io
As an entrepreneur, everyone thinks that, “Oh it’s great,” and you just climb up and to the right and make more money the longer you do it.
That’s not the reality. Entrepreneurship is like a roller coaster.
There’s ups and downs and scary moments.
I remember when I was 16, there were points where I was making twenty grand a month, and I thought I was on cloud nine, but you know what?
By the time I was 21, I lost it all plus I lost another million dollars that I borrowed, but eventually, I paid it back.
And it didn’t take me longer than one year to pay it back, but I made some big mistakes, and I wish I didn’t make them and someone was there to guide me.
I’ve made a lot of mistakes.
The first lesson that I have for you guys is business ideas are a dime a dozen.
That business that I lost a million dollars into was cloud computing. That was before Amazon Web Services.
I had that idea before them, but you know what? Business ideas are a dime a dozen. It’s all about execution.
I came up with that idea because I was getting all this traffic to my website, and it was coming in spurts, and I was getting a big bombardment of traffic my servers would crash.
And at that moment, I had this idea, but poor execution, poor team.
So execution and team are very important. Just because you have an idea, it doesn’t matter.
The second lesson for you, you need a focus.
That’s a good idea that I had, but I already had a business that was making money.
Don’t do too many things at once. I don’t know why everyone has ADD and wants to do 20 different things at once.
The third lesson I have for you is to be creative.
You’re going to be up against a wall as an entrepreneur, and people are going to come to you and be like, “We need more money. This is what we need to do. We need to spend this.”
There are other ways to solve a problem other than spending money.
Money’s tight as an entrepreneur so you need to get creative.
The fourth lesson is, save your money.
It’s harder to make money than it is to save it.
So when good times are there, save it because they won’t always last.
Even some of the biggest companies in the world, like Apple, they were doing really well, they went under.
Companies like Microsoft had to give them $100 million to keep them afloat, and now Apple is a huge company again.
But that’s what happens in business. Not everything just keeps doing well, so you need to save your money for the rainy days.
The fifth lesson I have for you is pick your business partners really carefully.
Just because you talk to someone over Instagram or you hang out with them a few times, it’s not that easy to get a divorce, especially when a business is working out.
It’s easier to get a divorce in real life than it is to get a divorce with your business partners once you have something that is up and running and working.
If you pick the wrong business partners, you won’t do well.
Be patient. That’s a big mistake I continue to see people making even today.
The sixth lesson I have for you is have a lawyer.
Shit gets messy in business. If you don’t have contracts, you don’t have things in writing, people can steal from you.
I’ve lost a lot of money from silly stuff by not having contracts.
Have a lawyer. You can pick anyone you want. Just have a lawyer. Someone who’s mediocre and doesn’t even have a lot of law experience is better than no lawyer.
The seventh lesson I have for you is, solve a really big problem.
See when I was staring off, I had a really small viewpoint.
I was like, “Oh, how can I help small and medium businesses?”
You need a really big market cap. Small and medium businesses, in this space, have a lotta churn. Bigger enterprise businesses don’t.
By picking a really big total addressable market, it’s much easier to build a bigger business.
The moment you pick a small total addressable market, it’s going to be really hard to grow.
It’s easier to get 1% of a big market than it is to get 50% of a smaller market, so might as well go after a really huge market.
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