4 Things First-time Entrepreneurs Need To Know About Getting Started
As featured on Forbes
When I launched my business, RealtyMogul.com, I knew I was onto something big. I could see the way the JOBS Act of 2012 would open up crowdfunding to a wider audience than ever before, and I knew from working with my mother that the world of real estate was ready for disruption. She was a real estate agent, and I watched her go through mountains of tedious paperwork by hand. I realized that the real estate industry was archaic and needed to be ushered into the 21st century using technology and the Internet.
The idea of forging my own path as an entrepreneur and entering the real estate space was exciting, but intimidating. As I’m asked regularly what it takes to make it as a young CEO, I wanted to offer a few reflections on the factors that helped me succeed. Making your first foray into entrepreneurship isn’t easy, but there are four key lessons that will set you on the right track.
1. Find Mentors And Seek Out Advice
Entrepreneurship can be a lonely pursuit, and I know plenty of business owners who prefer flying solo. But when you’re starting out, you need input and advice from others to help you avoid the common pitfalls that stall so many entrepreneurs.
Experienced mentors can help with everything from refining your idea to making major decisions about the future of your company. If you’re an entrepreneur, you understand the enthusiasm that comes with thinking your idea will change the world or revolutionize your industry. Working with those who have more experience helps temper your youthful excitement about your big idea and refine it into a more mature, workable business model.
Throughout my career, I’ve relied on everyone from family members and friends to colleagues and business acquaintances for advice. When I was negotiating a major acquisition offer for my startup, I received sound advice from the over 30 people I consulted, but it was one of my good friends – close to me in age – who offered up what would have the biggest impact on my decision: “You’ll be bored out of your mind if you give up your company.”
2. Learn How To Approach VC Firms
I once heard someone change the common expression, “Practice makes perfect,” to “Perfect practice makes perfect.” That goes double for pitching VCs. Make the effort to wow the people you want investing in your business.
While I have been fortunate to work with incredible partners who saw value in my startup, I have heard horror stories from VCs about aspiring business owners who go into pitch meetings with nothing more than a wing and a prayer, and who leave shocked that their “genius” has gone unrecognized (and unfunded). Being a first-time entrepreneur does not have to mean being unprepared.
Study the process. Learn the names. Make connections, and make absolutely certain you’re ready for whatever questions or concerns the partners you meet with could raise. Before I started doing pitches, we worked on our deck, pitch and I had rehearsed the answers to every possible objection to our business I could think of. When I pitched, our company came across as a team of buttoned-up and well-prepared professionals – the kind of company you’d want to give your money to.
3. Know How To Manage Your Employees
One of the most challenging parts of running a growing startup is scaling, and in my case, that meant going from zero to 65 employees relatively quickly. I’ve previously discussed building my core team in my company’s early days, and the experience taught me that I like hiring and working with smart, dynamic people.
There has already been a lot written on how millennials, Gen X-ers and Baby Boomers can work together. But for every employee you’ll find that meets categorical expectations, you’ll have another that completely defies them.
As a first-time business owner, you should invest in understanding your skills as a leader. Are you capable of bringing multi-generational workforces together in order to get the best work out of your employees? I’m a relationship-oriented person, so growing work relationships comes naturally to me, but if it doesn’t to you, you either need to devote time to developing your strengths as a manager or find a way to bring on others with managerial skills as quickly as possible.
4. Take Yourself (And Your Work) Seriously
Whether you’re a recent college graduate or have professional experience under your belt, understand that pursuing the dream of starting a business will involve a lot of hard work. It’s not enough to have a unique or revolutionary idea – you need to demonstrate a serious, get-things-done attitude to get that idea off the ground.
My business partners, mentors and employees took me seriously because I took myself and my work seriously. I didn’t just skim the JOBS Act; I read it cover-to-cover so that I could fully understand the opportunities it presented. I didn’t just call up VCs and ask for money; I had a well-honed pitch and a finely-tuned process for negotiating multiple offers at the same time.
Be persistent, but polite. Take your work as seriously as you want your mentors, employees, partners and other stakeholders to. This can help ensure that the focus will be on your business savvy and leadership skills.