Avoid
These 3 Big Mistakes I Made as a First-Time Entrepreneur -
Three years ago, I
founded a tech startup as a sole founder, in an unfamiliar industry, and with
no tech or startup experience. Looking back, I couldn’t have been more “out of
the tech scene” -- I was a corporate lawyer at Cravath, a formal firm in midtown
Manhattan. Making mistakes during those early stages of Updater was par for the
course.
In hopes that you will
avoid some classic “first-time entrepreneur” missteps and build your company
faster, here are the top three lessons I learned:
1. Don’t hire unqualified early employees.
When you’re running a
company of one to three people and trying to accomplish a lot without the
necessary manpower, it’s easy to think that you just need a few people to help
take the weight off, build the prototype, or just get you to the next funding
hurdle. Anyone will do, right? Wrong.
How did I hire my first
engineer? I hired one of the first people to respond to my job post who seemed
confident he could do the work and was willing to do it at a low price. I
thought I was getting a great deal … I wasn’t.
How could I have made
such a rookie mistake? In retrospect, I could partly blame the fact that I
lacked funding and connections to get top talent, but the real problem was that
I just didn’t know exactly what the job entailed. I understood the tasks that
needed to be completed, but I didn’t understand the skills the candidates
should possess to complete those tasks, or how to evaluate the candidate for
those skills. Unfortunately, with that lack of knowledge, my hiring mistakes were
nearly inevitable.
My advice to you: chat
with more experienced entrepreneurs and people currently doing the job that
you’re hiring for at another startup to properly understand the qualifications
for the role. Talk to anyone who will give you advice. They’ll help you
identify the right skill sets and help you set key performance indicators and
deliverables for the role, allowing you to hire more effectively and gain
proper expectations.
Also, even the earliest
employees are helping set company culture. Your early employees must have the
right skills, but equally important they must have the right personality and
attitude to help you build the company and environment that you want to create.
2. Find a co-founder.
Going at it alone with
no experience is difficult on all fronts. When it comes to startups, it’s true
that two heads are better than one.
While an idea can be
great, it’s really all about the execution, and my limited technical know-how
was, frankly, very limiting. Having a co-founder helps ensure that you have
someone to complement and balance your strengths and weaknesses, which is key
to long-term success.
Comfortable
accomplishing things myself, I waited a long time before finding a partner.
Waiting was beneficial because, over time, I was able to identify the exact
experience and skills my partner should possess to complement my skill set, and
as a result I was able to identify the ideal person.
However, I would have
achieved more much faster and greatly reduced the company's risk profile if I
had a partner at the beginning, even if not the perfect partner. So don’t start
your company alone! While owning 100 percent rather than 50 or 33 percent may
seem appealing, you’re probably increasing your likelihood of owning 100
percent of nothing.
3. Don’t protect your ideas -- share them.
I got this one all
wrong, too. I spent valuable time and money working to protect my ideas and
strategies for implementation, thinking someone might try to copy me.
Not only did I waste
time and money, but I also missed countless opportunities to get feedback from
potential users, clients and early adopters. I spent weeks (and thousands of
dollars) on patent and trademark protection, when I should have been building a
prototype and showing it to everyone and anyone who would listen.
What I know now is ideas
aren’t as valuable as they seem. Rather, it’s the ability to execute that’s
valuable. No one was going to steal my idea because no one was as passionate
about reinventing the moving process. In fact, hundreds of people probably
already had my idea, but couldn’t or wouldn’t execute it.
To sum it up, tap into
the resources around you for feedback and help.
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