“Here’s how I think of my money, as soldiers, I send them out to war everyday. I want them to take prisoners and come home, so there’s more of them.”
— Kevin O’Leary.
I am opening this blog in order to share the insights I’ve got to on my way to the first million at the age of 29. I will mainly use this blog as an instrument to express different views and to analyze some of the different experiences I’ve went through over the last few years, and due to life’s fast pace, I have not been able to find the time to process. For the time being, I have no interest in exposing myself, and therefore I won’t share the specifics of my current ventures, but this will not have any effect on the authenticity and the reliability of the blog’s content. I will do my best to be as honest as possible, and I will make sure to avoid those cheesy cliches about business and success that you come across to on every second click-bite article – This is a BS free blog and I think that this what makes it important. Sometimes, the journey to success can be boring, not dynamic, limited in risk, and it won’t contain Ivy league excellence standards nor the hustling/street wise of the Youtube coaches. One of the most important things that I’ve missed the most when I took my first steps in the entrepreneurial world, were a handy, reliable and BS free sources of knowledge. The internet is full of Startups cliches, Ted talks by “inspirational” leaders, and success guaranteed checklists. I hope that this blog will help individuals and managers who are looking to grow their business or start a new venture, with feasible tips and honest insights. But the main reason for starting this blog, is to unload those intense feelings and thoughts that added up over these few years of intense entrepreneurship – if no one will ever read these lines, it is still probably be an amazing therapy for me.
On previous blog posts I’ve discussed some of the most exciting aspects of entrepreneurship. In this blog post, I would like to discuss the 5 untold challenges that comes with early business success.
Anxiety and low self esteem
When I just opened the company, a few years ago, I was a just a kid. I was cool about everything, and had one dream – To generate enough profits in order for us to pay ourselves a lousy salary. I didn’t care how we’re going to do it, and was unaware of risks by any kind. We were fortunate enough to generate profits very early on, and it took us less than a year to release our first dividend, a few months after our first salary. As the business became bigger, we were no longer a tiny under-the-radar company, and suddenly we had dozens of commercial contracts, employees, offices, credit line etc. Suddenly, we became a real company, and we had to manage it like one. Than there’s the legal aspect – You’re starting to realize that there’s a lot of responsibility to the company, and in some cases, on you personally. Now you start to hear about “Director responsibility”, or about this one insurance policy you forgot to do. Everything becomes scary, and you become paranoid. You considering to buy tiny recording system that can proof that you were voting against a decision that you think that might have an illegal aspect. You vote against it, and your experienced partners are picking on you, and blaming you for being a kid that don’t understand the law. 2 months later, you read an article on the internet that proves you were wrong, and it is 100% legal. Your confidence is decreasing and you doubt your judgment. It’s a vicious cycle that is not easy for young individuals.
All of your friends are working 9-9. They’re pretty successful, and they’ve landed a job at a top consulting firm or a big tech giant. Their professional route is pretty clear – They start as marketing interns, than becomes analysts, than promoted to product managers, than an MBA and you know the rest of it. They have benchmarks, and they compete with each other. The next step is known to them, and their challenges are pretty similar. The worst thing is that they are making good salaries, and they post on Instagram photos from their firm’s private concert with local pop stars.
You’re, on the other hand, facing hardships that are really unknown to your successful employee friends. They don’t understand how it feels when a multi million dollars supplier calls your personal phone and asks you when payment is going to be made, and that it will cut you off and post a LinkedIn post about you personally if you don’t wire it in 48 hours. They don’t really understand the cold nights when you can’t fall asleep because you’re afraid of a rumor that your biggest client who owes you more than $1M is about to bankrupt. And the worst thing, is that when you try to talk about it with friends, they think that you’re bragging, and they get all defensive. They think that you’re trying to be cool, and talk about how successful your company is (If 1 client alone owes you $1M than you’re probably really big). My friends don’t really want to hear about my problems, and honestly, they don’t have much inputs anyway. So you’re left alone, trying to figure out if you’re doing the right thing, and if you’ve made the right choice when you chose to chase revenue for living. I give you a hint – It does, but it’s not always feels like that.
3. Faking as a way of life
So you’re 29, your partners have decided to ignore that, your employees are asking themselves whether you are qualified (And they are older than you), potential investors are raising eyeballs, and service providers are targeting the young partner when they try to upsell. The solution – You need to fake on a daily basis. You try to know a little bit of everything, you’re googling a subject 20 minutes before a conference call and you present yourself as an expert in the field, and you put a confidence mask when you talk to your employees but deep inside you have no idea what you’re doing. To be honest, I think that this is how most business is being done, and in the end you actually becomes better at that, but it is a really big part of my day-to-day routine as a young leader in my firm.
4. Low job-market value
So you’ve made $1M or even maybe $2M. You’re really did well, and you have your whole life In front of you. But let’s be honest, this is still not wealth that enables pension at 30 (And who on earth would want that anyway?). So you’re still going to work for many years probably. Let’s assume that you sold your equity shares, and now you wants to have a kid and take a year or two as an employee with fun days, happy hours, and maternity leaves. The problem is that you’ve seen the matrix. You’ve seen how dividends/exit/IPO is the only way to really make money. You’ve seen how 90% of the revenue is generated from personal relationships and bullshit features. You’ve seen your employees selling their time and freedom, don’t go to family events, asked to work off hours, all for the one goal of making you richer. And serious employers knows that you saw it. Half of them wouldn’t take the risk. They’ll assume that after 6 months you’ll open your own shop, taking their clients and their corporate knowledge. You’re now an entrepreneur, and you can’t really change that after you’ve done that for a few years. It’s not a bad thing in my opinion, but you should be aware of that. 2 years at Mckinsey or Amazon will take you much higher in the job market than anything you can do as an entrepreneur, keep that in mind.
5. High expectations
So now you’re the rich brother, so no one pays you back when you order the flight tickets to the family break. Your girlfriend never demands for a dime, but got used to great restaurants, and you don’t want her to expect anything lesser than that. Friends from college are calling for your input on a business idea they had. You now have a reputation to maintain, and no matter how discrete you’re trying to be, people are talking about you. And it’s 10 PM and you only now finished a loud fight with your partners about small and irrelevant issues, and all you want to do is to run away for a year. But you can’t, because you’re expected to be awesome, and you expect it from yourself as well. On top of that, now you feel like you have something to loose, and you take your life very seriously, as if any decision you will take is going to have a huge impact on your and your loved ones life. You become like a brand, that needs to show that he is cool, successful, happy and up to date. You went into business because you wanted freedom, but this definitely not freedom. You hope that you’ll suffer now but you’ll gain freedom in the future. I still believe that. Meanwhile, I feel like shit. A high functioning, efficient, and successful shit.
These were 5 untold challenges that comes with early business success. It was written from my guts, and it describes the hardships that I went through personally, and heard from other young entrepreneurs I met. Is that a price you are willing to pay?
Achieving business success, in my case, can be attributed to the following factors: 10% talent, 40% luck, and 50% industry trends. Choosing a fast growing industry, and playing in the blue-ocean areas of it, can have much more impact than your technological capabilities, financial backing or personal talent. Even if you’re looking to viciously compete in red oceans, choosing the right business in the right industry is extremely important. You may go and compete with Coca Cola or P&G, and I wish you all the best, but by the time you will get your first lame investment, I will already be investigated by the SEC for trading inside information of my public NYSE listed company. If you want to see the walls of the SEC investigation rooms like I do, you need to be ahead of the curve, and look for the hottest business trends out there. Here are 5 trends That will shape the business market in 2020:
This over hyped term is all around us. Sounds like an extremely complicated area that is kept for the top 1% elite engineers. The truth is, that AI is complicated, but there are many engineers out there that can implement those models into specific sub industries. Those models, in general, can learn on their own, and “see” things that the developer may not see. Let’s assume that you’re in charge of the financials of a company, and you feel that a specific task you’re doing on your daily reports is inefficient and can be automated. Up until a few years ago, you would be developing a rule based model which imitates the exact steps you’re doing on an excel sheet or your accounting software. Nowadays, with AI, we can create a model that “learn” on it’s own by imitating human thinking and deducting. You may look at AI, as everything a human can do, but we still don’t know how to program it. If you have a great idea for a digital business, consider hiring an AI engineer that can help you get your tech to the next level. I’ve done it with our CTO, who’s a lone engineer in a room full of business operations and sales people. We’re now using AI in our business and it actually delivers.
2. Social media is changing
If you’re a millennial, then you are probably using Facebook, Twitter and LinkedIn. If you want to market on these channels and to drive organic or paid traffic, you must compete hard. for unique opportunities in social media, look for the hottest trends, that mainly arise from generation Z. Ephemeral content is now the biggest thing out there. If you’re not familiar with that, it is just a complicated name for content that is available for a short time and then disappears. The most obvious example is an Instagram Story.
Another opportunity is with TikTok. This app already has 500M active users and it is crushing it. People are spending hours a day watching videos on TikTok and the opportunities to reach engaged eyeballs are huge. It is still not as scientific as Facebook, so organic reach is still possible. Another amazing platform is Reddit, and I recommend learning and utilize it for your business social media marketing.
3. Social commerce
Social commerce is the selling of products directly through social media platforms. The social platforms giants are now looking to take a chunk of the massive E-commerce market. With twitter investing in the field, TikTok allowing E-commerce links and Instagram already releases new social commerce features such as e-commerce checkout, you can expect this vertical to keep growing in 2020. If you’re selling consumer goods, or wants to enter this industry, don’t forget to add social commerce to your online presence. This trend can help you leverage the more traditional Amazon/Shopify channels, or even replace them completely, so make sure you’re experimenting and utilizing this opportunity. When the giants are competing, the benefit is all ours.
4. Health, green and moral in F&B
This has been going for years now and it is just getting stronger. It is true that companies like Beyond Meat are being criticized by capital market analysts for inflated share prices, but that’s more of a tech bubble issue, and not a vegan bubble issue. If you’re in the F&B industry, look for opportunities in the Veganism, gluten free or sugar-free space. Look for Spirulina, not Burgers. I would also look into niche specific technological opportunities – think of Gluten detectors, health-food delivery services, or online health and vegan educational resources.
You may think that there aren’t many business opportunities in sports as it’s not the most innovative industry. But that’s just wrong as we’re talking about one of the most exciting and profitable industries out there. Trends such as fan engagement, E-sports, Data collection and analysis, AR&VR, Gambling and content distribution are all revolutionizing this industry and taking it by storm. If you’re passionate about sports, and you have some technological orientation, the opportunities are massive.
Those were 5 trends that will shape the business market in 2020. There are many more opportunities to look for and I will discuss them in future posts. For now, focus on increasing your success chances and reducing your risks. This can be done by choosing the right market and the right time.
Cash flow is king. Everyone who is managing a successful business knows that. Even the crocks who runs those over valuated retarded tech startups cannot run away from it – They can only keep on lying if they have enough of your pension funds in their bank account. If you’re serious about your business, you need to plan ahead, and make sure that you’re on the safe side in terms of cash flow. By the time the tax authorities, your employees, the pension funds, the VAT, your suppliers and everyone else who is looking to suck from your warm golden tit will knock on the door, your theoretical gross profit will only be relevant to your broken excel sheet.
So what do you do? You’re looking for clients who pay faster, you increase your margins, you get funded by greedy investors or you just take a loan and feel less stressed when you open your bank account. Always make sure you have enough funds to run your business for a few months, even if things go wrong. But there is one exception, and it is more important than your business’ cash flow – Your own personal bank account.
I did it in 2.5 years, it was pretty easy. Until it wasn’t.
In this post I’ll discuss about the connection between stress and entrepreneurship. In the initial phases of the company I didn’t care about anything, only the success of my start-up. At that time I was unhealthy, unprivileged and unhappy so I didn’t have anything to lose. I was willing to take high risks, fight with everyone, and put my personal life on the side. Stress and entrepreneurship seemed natural for me back than, and I wasn’t suffering from it too much. Our first dividend was taken 1.5 years after we formed the company. My accountant said it was one of the quickest dividends he saw. I was entering my bank account every few hours just to feel good about myself. I started going out to nice restaurants, and bought my wife presents. Probably much less than my partners, as I am the quiet and humble one, but still, for me, it was an upgrade of my lifestyle.
By then, I have days where I am going from the gym to a therapist, and from there to a personal lawyer. I felt like I need it in order to maintain high performance, and I could afford it. I found myself, for the first time in my life, with something to lose – good life. Things started to scare me, risks I took in the past were chasing me in my dreams, and most of all, a cold feeling of loneliness have arise. Anxiety was now a part of my life.
I was still a high performer, and I still enjoyed the good life, but it wasn’t as smooth and easy as it used to be. I started treating myself with extra care, and was looking for stability. I didn’t find it. As months passed, my mental health got better, but not as it used to be. I am still not that happy, and every day I find more and more grey hairs (Not yet 30, remember?). Over the last year, more profits went out to the partner’s pockets, and I am extremely proud that I’ve managed to get more than $1M in dividends, and to build a significant company with employees and a good reputation. All of that is not making up for the feeling of anxiety and unhappiness that is still with me from time to time, on a daily basis.
I would love to hear your thoughts. Stress and entrepreneurship is a topic that is not widely discussed ,and I think that many entrepreneurs are suffering because of it. Do you think that this is the faith of a businessman, due to the volume of stress and accountability? Sometimes I think I should sell my shares and go on a vacation, and after that, to build a new business, something exciting and fresh. But I am afraid that I’ll lose too much, as I’ve managed to build a good steady income, and I am not sure that I can be happier without it. What would you do?
After my last practical post, I am back this time with another concept I want to share. In this post, I want to discuss an unpopular subject and to present a list of 7 business stakeholders you should absolutely hate. Based on my experience, positivity is overrated in business. The best entrepreneurs I met, were extremely sensitive when it came to their business. You might have a vision of an ideal corporate CEO, sitting with his poker face while being put under pressure by his competitors or anyone else who wants to burn his business. Forget about it. Start using your feelings, even if your cool by nature. HATE your competitors, pray for the failure of the people who thought your business is a joke, and love everyone who is beneficial to your business, until the moment they aren’t anymore. I’ve learnt that by becoming an emotional entrepreneur, I’ve managed to better connect to my business. This connection was crucial, as it enabled me to viciously protect it from anyone who tried to crush us, to negotiate with us or to fool us. When an employee, a business associate or even my banker had given my business with great value, I loved them, truly, and they all felt it and respected it. I took them to a fancy restaurants and told them about the bright future we’re all going to have. When an employee left the company out of the blue, I went back and hated him, with all my heart. I wasn’t cool about it, and didn’t wished him best of luck in his future adventures. You want this soft millennial coward business attitude in your life? Go and follow some Linkedin influencers who truly believes that the good guys finish first. They are wrong.
Here’s a list of 7 business stakeholders you should absolutely hate:
Your competitors – They are the number one individuals you should truly hate, personally. Let’s have a small test. Think about the number one competitor of your business. Now think about this competitor’s CEO. What feelings are rising when you think of him or her? If it’s not pure hate, mixed with irrational and mean wishes, you need to question whether your heart is in the right place. You should absolutely despise him. It will make you a more vicious and more competitive business man, as you will be playing with your heart and ego and not only with your pockets in mind.
The government – Publicly, never show any negative feelings or thoughts about the government, that’s just calling for problems. But deep inside your heart, you should always remember that the government is your passive partner. It doesn’t do anything, but it gets most of your profits. Hating the government, and specifically the tax authorities, will help you be more ruthless when doing your tax planning. Paying taxes is the worst thing in business, and every cent you will keep to yourself is holy.
Bad employees – I can’t stand them. There 2 sorts of bad employees – Good and cocky employees which delivers, but they think that they are so good and irreplaceable, and they visit your room once a week for a pay rise. Eventually they get so desperate with you, so they resign and try to build their own shop or move to your competitors after a few months. Their ROI is negative, and they are toxic. I HATE THEM. The second kind are the “Interview Champions” who survives purely due to their interviewing skills. They practice for months for job interviews and leave great impression. Once they’re in, it takes a few months until you realize that they are useless. Both kinds are disgusting, but the first is the one I hate the most. But I am sure that there are more kinds of bad employees, and they are all deserve the same thing – A long career as a McDonald’s cashier.
Your bank – Your Bank is always smarter than you. When you just start, you will ask yourself hoe the hell are they making money with those commissions. Once you succeed, you’ll ask yourself how the hell these institutions still relevant and why Silicon Valley didn’t invent a free, ad-based substitute. While you need your banker to love you, always secretly hate him, and never trust him.
Your suppliers – They will send you low quality inventory, add 10% to the invoice and hope you wouldn’t notice and try to up-sell even if you’re going out of business. Never forget to hate your supplier!
Bad clients – There’s need to be a special place in hell for bad clients. When you’re small, they will pay on a net 240 basis, and once you will become successful, they will threat to write bad reviews online. Every client can be a bad client. You should always live your good clients, but remember one thing, every good client becomes a bad client at one point.
Outsource employees – From Mumbai to Kiev, there are endless outsource employees who are looking to make their lives better with some western capital. They will open 3 fake accounts and make you believe that 3 people are working at all times on your projects, or they will work on other client’s projects while they’re on a full time contract with you. While outsource teams can save money, never forget to hate the scammers that take advantage of the remote obstacles.
This was a list of 7 business stakeholders you should absolutely hate. I hope that once again, I’ve managed to shed light on the truth, and not the garbage that you hear on TED.
In the introduction, I have emphasized the importance of tax planning. From time to time I will give you some practical information that will help you get the funds you deserve. I got asked from one of my followers about the tax refund schedule and I thought I might share with you some info about it. While I can’t tell you what would be your refund sum, I can give you one important tip – File it using a software program or with the IRS E-File. This will save you a lot of time and you will get the refund much quicker. Normally, the IRS issue refunds in less than 21 days. The tax refund schedule of direct deposit is usually 7 days shorter than the tax refund schedule of paper check mail, therefore, I recommend to choose the first option.
Tax Refund Schedule – This year’s data
Below you will find a chart which shows this
year’s data, which should help you evaluate the length of the process (source: The
2019 IRS Tax Refund Estimated Calendar
Direct Deposit Sent
Paper Check Mailed
Jan. 28 – Feb. 2,
Feb. 15, 2019
Feb. 22, 2019
Feb. 3 – Feb. 9,
Feb. 22, 2019
March 1, 2019
Feb. 10 – Feb.
March 1, 2019
March 8, 2019
Feb. 17 – Feb.
March 8, 2019
March 15, 2019
Feb. 24 – March
March 15, 2019
March 22, 2019
March 3 – March
March 22, 2019
March 29, 2019
March 10 – March
March 29, 2019
April 5, 2019
March 17 – March
April 5, 2019
April 12, 2019
March 24 – March
April 12, 2019
April 19, 2019
March 31 – April
April 19, 2019
April 26, 2019
April 7 – April
April 26, 2019
May 3, 2019
April 14 – April
May 3, 2019
May 10, 2019
April 21 – April
May 10, 2019
May 17, 2019
April 28 – May 4,
May 17, 2019
May 24, 2019
How to prepare for your next tax refund
Preparing to your next tax refund application is pretty straightforward, look for the next IRS’s tax refund schedule, and apply on time. Make sure you have the following (Source: The IRS):
Proof of identification (photo ID)
Social Security cards for you, your spouse
An Individual Taxpayer Identification Number (ITIN)
assignment letter may be substituted for you, your spouse and your dependents
if you do not have a Social Security number
Proof of foreign status, if applying for an
Birth dates for you, your spouse and
dependents on the tax return
Wage and earning statements (Form W-2, W-2G,
1099-R,1099-Misc) from all employers
Interest and dividend statements from banks
Health Insurance Exemption Certificate, if
A copy of last year’s federal and state
returns, if available
Proof of bank account routing and account
numbers for direct deposit such as a blank check
To file taxes electronically on a
married-filing-joint tax return, both spouses must be present to sign the
Total paid for daycare provider and the
daycare provider’s tax identifying number such as their Social Security number
or business Employer Identification Number
Forms 1095-A, B and C, Health Coverage
Copies of income transcripts from IRS and
state, if applicable
But preparing for a tax return, is not tax planning. You know by now that I am a big advocate of Not Paying Taxes Legally. I will share more insights about how I’ve managed to save more than $100K a year using a tax benefit we’ve received in our company. Meanwhile, I want to recommend a great source to get you into this mindset. The guys from AxeTheTaxes are doing an amazing job and help you keep your rights and pay less taxes. Their free test is a good place to start.
In the following “Failure is a Disgrace, Risk is Stupid” blog post, I will share my thoughts over the culture of entrepreneurship we live in, and how you can survive it and build a business that actually succeeds. The meteoric rise of young technological entrepreneurs have sparked the minds of a whole generation. A tech entrepreneur isn’t just smart, rich, young and successful but he is also doing the right thing – He solves problems and helps making the world a better place. The problem starts, When all this hype made us believe that we can do it as well. Why is that a problem? Because we can’t. I will take a small risk and determine that you, the person who reads these lines now, is not able to establish a unified team of world class business partners, build a team of best-in-industry engineers, attract venture capitalists, and build a product which eventually will be sold or go public at a billion dollars+ valuation. Most people don’t understand just how rare this case is, especially for young professionals with no significant network and experience.
Wake up and start thinking smaller. Don’t look for applause from your Innovation&Tech Facebook groups, and don’t be shy telling your friends from Meetup that you are building something small inside an established industry, or that, god forbid, you are copying an existing business that you think you’ll be able to operate better. Avoid using words such as “disruption” and say goodbye to your loser friends from Fuck Up Nights – They fucked up because they are young, cocky, uneducated, unprofessional, technologically disabled and have no business orientation. Give more respect to the grey haired and the bald, who have the experience and the network to do the things you think you can do in your 20’s. And the most important thing – Stop looking at startups as a CV line – Your business have no justification if it fails, and please don’t give me the “The amount of knowledge and experiences I went through over the last 18 months” explanation. Failing a business is a disgrace, not something you write on your CV or brag about on Fuck Up Nights. You need to build businesses that are within your measures, and not some delusional fantasies which were born on the startup competition of your community church college. It is a matter of style in my opinion and a sort of statement – Failure is not an option for me, and I am not taking part in those millennial’s failure festivals just so we could keep give incentives to losers who thinks that it is OK to take their parents money and burn it on stupid ventures. All of the above is not here to d evaluate the importance of learning from mistakes, as it is really a great way to grow, but it is a noble way, in my opinion, to present business failures – It is an embarrassing, unexpected and sad result of a poor business operation.
This was all a build up for another term I want to discuss – Risk. Great entrepreneurs are considered as bold risk takers who were willing to lose it all in order to win big. Risk became sexy, and we constitute social conventions which supported it. 95% of startups fail? No problem, it is normal and there’s nothing wrong with me being in this category. My take, is that a good entrepreneur is a risk hater. He takes risks only when the potential gain is so significant, it justifies taking it. Some financial models claims that within efficient markets, risk and gain potential are correlated, and higher risks goes hand to hand with higher potential gains. In the real world, markets are not efficient, and there are information gaps. There are business opportunities, that carry low risks and high potential gains, and there are opportunities with high risks and low potential gains. In many cases, unregulated industries and markets can have business opportunities which are low in rise and high in gains, I personally love it. Great entrepreneurs also look on their personal qualities such as knowledge, network, self-esteem and resume as factors of d-risk. The more they can rely on themselves or their team, the less chances of failure.
If you got this far and I have not totally shredded your self-esteem, there’s a chance that you’re made out of the sexy material of a successful tech startup entrepreneur. But if you’re a normal person such as me, I probably managed to discourage you a little bit as you always thought you had a Zuckerberg inside you. This the place where I want to offer a model, which worked for me and helped me gain confidence, knowledge and a network, which enabled me to achieve business success at a young age. While I was a senior college student, I already knew I wanted to be an entrepreneur. At that time, I was the usual arrogant startup kid, who thought he was going to build a multinational company with unicorn valuations. I was actively looking to build this world changing company but was lucky enough to not finding partners to join me in this journey. I than had an idea – I’ll go work for a tech company for a while, learn it from the inside out, build a network, and after a year or two, I will start my own company in the field. While most of you probably thought about doing it many times, I am proud to say I did it. I think it worked because I actually followed it, and with every step I took as an employee I was asking myself how it can benefit me for the day I will open my own company. I met a colleague who I pointed as a leading figure in our industry, and immediately knew he was going to be my business partner. We than joined another partner, and after s year, we were already generating our first $1 as a company. I was by far the most inexperienced guy in the room, but the partners appreciated my energy and hunger. In just one year, I was able to gather business partners, industry knowledge, sufficient network and enough confidence to quit my job and launching a tech business. I was laser focused, and I understood that I need experience partners with me, not just ego maniacs. Following my latest blog post about finding the right business partners, in the next blog posts I will discuss about how to find good business opportunities, and how to build small companies that leaves you with high equity stakes that can make you millions, even when the company is small.
Hopefully, what you will take from this post is a mindset of “Failure is a Disgrace, Risk is Stupid”. This will help you get into projects that are not too big for you, and actually make them succeed.
After my latest introduction post, it’s time to dive in to the first blog post. Choosing your business partners would probably be the most significant decision on your life for the following months, and hopefully, years. Let’s jump on to the obvious stuff that must be mentioned – Your business partners should be individuals who you trust, who completes you professionally, who are true stars in their fields and are fun to hang out with. But all of these are not interesting. In this post, I would like to discuss qualities that I only found out about over the years, and notice how lacking them or having them within our business partnerships skill set really had a big impact on our successes and failures. The truth is, that the process of finding a business partner is much more spontaneous the conceptual, but I hope that this post will help you evaluate the potential of your spontaneous business partnership forming process. The post consists of 8 business partnership skills that I found to be crucial within a business partnership. This is a very important post which I wish I was exposed to when I started in business – Read it all, and don’t become unmotivated if you find out you lack most of the skills and qualities I will mention as they can be learned or be acquired by partner with the right individuals. These are 8 business partnership skills that are crucial for success:
“All In” mentality
Building a business requires you and your
partners to allocate almost all of your time in order to pursue success. If
your business partners are married with children, they need to be aware that
they are going to pay a price and prioritize the business. It’s not that
building a business requires 18 hours working days, but it means that whenever
an urgent matter arise, and those are very common in the beginning, everyone
throw away whatever they are doing, and get on board in order to fix the
problem or maximize the opportunity. No one goes home and no one counts who
worked more hours today, you just doing everything you can do for the sake of
the business. The only exception is if one of the partners died, other than
that, everyone on board.
The reason that this “All in” mentality is
important, is because somewhere across the road, or across the ocean, some
individuals are trying to destroy you and your business by building a better
service or product. Unlike the startup blogs you guys are reading, and what
they’ve told you on the recent fuck up nights’ meetup you attend, business is
not a place for losers, they are just not welcome.
I can say that me and my partners are hanging out with our spouses and children much more than my employees’ friends. But all of us are 100% available for the business – Nights, weekends, Holidays, we will be there no matter what. The main point I want to share is that being All In is not about working al day long, it is about being available for the business all the time, and when the business needs you, it is even more important than your family (Don’t worry, eventually they will enjoy the fruits of your weird priorities)
This one I like. Money is made only with people who really wants to make it. An example I like is the fact that me and my partners were arguing a lot in the early days of the business, over the equity shares of each partner. On your average Startup blog, you will read that this is a red flag and that you should run away from a partnership that begins that way. They will tell you that a startup is a mutual adventure, and it doesn’t matter if once a liquidity event occurs each partner will make $10M or $12M. But in our case, things were difference. One of the partners demanded higher equity stake, as he was more experienced and had more connections than the rest of us. This partner, eventually, got what he wanted. I don’t have any other way to describe him, other than a Pig. He is a greedy bastard that will negotiate till the other side collapses, up-sells ruthlessly and won’t let any big corporation treat us like a small company. He is personally signed on ~5M deals he bought to the company all by his own. This Pig is responsible for a big portion of my personal wealth. Don’t fear greediness, you need it in your business, and as long that the greedy partner can be trusted, it might be a winner.
Number 3 in our 8 business partnership skills list is aggressiveness. Throughout my life, I used to believe that the “good guys finish first”. I was captured by inspirational stories of nerdish entrepreneurs who wanted to save the children of Africa and by accident made millions. Although I always appreciated and valued good sales pitches and assertive individuals, I was amazed to learn just how aggressive people can be when it comes to money. In my opinion, each one of the partners must have the ability to not being nice. You will find out that in most business interaction you will have the option to negotiate, and by doing so, you will improve your business bottom line. If on of the partners is a total bad-ass who is fearful and aggressive, and you will know how to integrate him within your culture, you will have a big advantage.
Unlike most of the other skills and qualities I’ve discussed so far, this one is almost impossible to acquire. Someone within the team must be Charismatic, it doesn’t work without it. This individual must excite investors, employees, suppliers and clients. If this individual is the company’s CEO, it’s a winner. Form my experience with business partnerships, it is not enough for a person to be charismatic – He needs a welcoming ground which will enable and hold this quality. I’ve seen the most charismatic individuals, that were completely shut down by their business partners. It normally happens in rooms with multiple dominance individuals who have their ego crushed by another partner. This can destroy that magic quality we call charisma. Good teams know how to maintain this quality and nurture it within the partnership. If you’re charismatic, as well as one of your partners, make sure you’re not disabling each other and b that, hurting the company and the partnership. In case there isn’t a partner who’s charismatic enough, consider look for a partner that is.
This should go without saying, but in a generation where every undergraduate srudent thinks he is Steve Jobs, this must be mentioned. You need to build the best team out there in whatever field you operate in. Don’t just look or be someone good in your area, the team needs the best people in your field, otherwise there’s a good chance you will get crushed by your competitors. There is no point in opening a venture with weak or inexperienced individuals. The point here is simple – you need to be better than companies who already succeeded and have resources. You won’t be able to do so if you don’t have any advantage. These advantages can wear many forms – Unique business relations, technological capabilities, Human Resources, sales team, tax benefits etc. In any case, the team must know it’s industry, it’s stakeholders and the right way to execute. Most guys I talk to in the startup arena are not industry professionals, they like to call themselves disruptors. In their mind, it is even better that they are not coming from within the industry as the can think out of the box. That’s pure BS.
I know you’re all artistic visionaries, but let me get you back to the ground. Someone in the team must be organized. Yes, you can have a messy (And genius) partner, but someone must balance it. You’re going to deal with a lot of invoices, emails, contract and deadline – until you will get a personal assistant, the team will have to manage all that. Today it is easier than ever to have an organized business. This is a boring point, but it is extremely important.
Number 7 in our 8 business partnership skills list is Urgency. One of the things I was not aware of in the beginning, and was exposed to it’s importance only with the time, is the value of an urgent culture, when needed, in the team. Core issues must be dealt with a sense of urgency. It’s part of having that knife between the teeth. If you received an alerting email from a client or an investor, you stop everything you’re doing, and you allocate all of the partners’ energies into solving the issue. When the business grows, and you have multiple employees, not all of the daily routine must be sopped, but until that day, being the only people in the world that cares about the company, all partners are on their feet solving the problem. In my opinion, and against common intuition, this method should be used even with small issues in the beginning. Let’s say you’ve received an email from the bank, asking you to provide papers that must be sent in order to meet with state regulation. This sounds like something you can do tomorrow right? No. You handle it now. It will take you 10 minutes, but when a supplier hit you just before you leave the office with a credit cap, asking you to pay now or he cut the supply immediately, you’re going to need this bank account active. Yep, in 90% of the times it won’t happen, but in the 10% it will, it is worth to take a deep breath and make sure there are no breach that allows you competitors to crush you.
8. Detail orientation
I was lucky enough to partner up and work with all sort of entrepreneurs over the last few years. I’ve spotted a sort of spectrum that you can put all of them in. On one end, there’s the perfectionist professionals who goes into details, works with working methods and are characterized with high levels of organization. On the other end, we have the dreamers who cares about the essence, and don’t like to spend their time on the non-important 80%. There is no way to determine who’s a better entrepreneur, but it is pretty safe to say that the dreamer needs a perfectionist with him. You cannot really cope with business challenges without going into details. This is true to all business factors – Sales, HR, Development, operations etc. On the other side, the dreamer usually holds really valuable qualities – He get things done, he’s energetic, creative, visionary and can have a strategic view advantage. If you’re a dreamer, I suggest you’ll find a partner that respect and value your vision while complete you with analytical thinking and accuracy. In many cases these entrepreneurs are ex-military, strategic consultants, investment bankers, lawyers etc.
I hope you enjoyed reading about the 8 business partnership skills that are crucial for a business success. Please comment and let me know what do you think about this post and if it was valuable to you.
Words alone and actions alone – after promising you a millennial inspirations free blog – Here’s an inspirational paragraph about the path I went through to success. Yeah, it’s not that kind of blog, but these pieces of information will help you understand and to process my insights and claims over the upcoming blog posts. I grew up in a low income city. Money was not in abundance but I did enjoy from the qualities of my parent’s values which makes me believe that I received a good education. One thing was missing for sure – aspiration to excellence. My parents enjoyed watching me exploring the world through my many hobbies, but never pushed me nor expected me for greatness. I’ve always saw my parents as a simple couple, which chose to live a modest lifestyle. (My expended family lives in bigger cities, with much higher financial and academic achievements). On top of that, I wasn’t really interested in studying, and found myself at the age of 18 with no formal high school education diplomas. Important to mark – This wasn’t a rare view at my school, as most of my friends were in my position and were not able to finish high school. You could say, that my friends were not really favored by my parents, as they exposed me to some unwanted activities at a very young age. But those friends thought me a lot, and gave me many tools that were handy at different paths in my way to my first million dollars. Ironically, they were the ones who aspire me to success, and it was in ways which they don’t teach you in college (Which is extremely important as well). The main lessons I’ve learnt from my childhood friends were as follows:
Sometimes, you need to be
Cash is king – Money is a
good thing and you can publicly speak about it, you always need to aspire for
more, and the most important thing –
valuation is cool but what matters is your bank account/liquid assets.
Avoid taxes – While tax
evasion is always a bad idea, you need to do your best to legally avoid
from paying taxes. There are great consultants out there that will help you do
that. Would be nice if once you’re rich, you will donate to different causes
Money equals freedom
Money equals independence
Money equals power
My childhood friends and I, never came from rich families, but we always had cash in our pockets, and while it’s source was not always pure, it was always from true entrepreneurship. They used to open a lemonade stand at the local festival, buying and selling second hand cell phones for a profit or dealing with pot in a high demand market (The neighborhood). Always thinking about destroying out competition, increasing margins and building a sufficient reputation that will get clients to come back for more.
After finishing my mandatory national service doing basically nothing, I went abroad to Europe and I was working as a salesman at different shopping malls. This was a great lesson in aggressive sales. After a year or so, it was enough for me – I went back home and started working in a losing metal manufacture, earning minimum wage while getting up at 5 AM every day – I hated it.
At that time, I didn’t know what I wanted to do with my life, and a close person had introduced me to the concept of Pre Academic school – A 1 year, full time and intensive program which replaces high school diploma. I looked it up and decided to enroll, knowing that I have one major strength – When I want something, I am chasing it like a hungry Pittbul. Up until then, I’ve used this quality of mine in order to pursue my hobby’s goals. But here I was, working like a mad man in order to be able to get accepted to a university. Long story short – After the hardest year of my life, I was able to finish this year with distinctions. Not because I was so smart, but because I was laser focused. I was able to pretty much get accepted to any major I liked on all major universities, and I ended up taking Economics as my major under a special elite academic program. It Is now a good time to reflect about myself, as objectively as possible. I am not a stupid person, but my IQ is not extremely high, and my talents are not exceptional. I have specific values and world views that are a bit different than most of the people I know, and it enables me to stand out in business for instance. The way you view the world, may have more impact on your success than your intelligence or skills you were born with. As I promised to keep this blog BS free, I must admit that intelligence, talent, and academic capabilities does have huge impact on your success, but in many cases the more you have those, the less likely that you will take risks or be in a position where you are questioning the conservative methods to success in life. It is important to mention that I am not in favor of risk of any kind, or you may call me a risk hater, but I am aware that sometimes you must risk yourself a bit in order to achieve what most people can’t.
Let’s move on with my story – My college years were great, but I sucked academically. I am really not proud of it, but my grades were much lower than the average in my class. I couldn’t care much about the classes, as my head was bothered about money making. But I was looking at it, from an elite and academic point of view, as I remind you that I was studying in a fancy academic program, and I did enjoy the social benefits it provided me, such as mingling with the government ministers’ kids. This was a mistake, as it made me forgot about the basic rules my childhood friends thought me. I was building my first venture, which was really bad from a profit making point of view, but it enabled me to expand my network in some industries which than looked to me appealing. A venture which looked nice on my CV, but was never supposed to generate real profits for me. I’ve tried, and for some extent succeeded, to scream success, and put a business man mask the short way. I was a victim of the millenial Start Up fashion mentality, where too many people, are thinking too big and are desperate to inspire, without any background or talent that justify it.
I can say one thing about it though – this business is 6 years old, and it still runs and sustain itself with full time employees, so I am guessing it is not a total failure, but I have not made a dime out of it, and today I am not part of it anymore. There is no problem with people who wants to inspire and to change the world, but it is just not my style, and it is not this blog’s style. I don’t care whether your business cleans the water of Nigerian kids through innovative technology, or whether it sells cheeseburgers, I only care whether this business creates cash flow, or/and value. Generating profits is not an act which needs to inspire or fix the world’s problem – it just needs to generate profits. Profits and value are the only things that matter in a business, anything else should support that. Therefore, I would suggest you to be focused on value creation and profits as well. When you will be in a position where you acquired significant wealth, I would encourage you to donate to charity and to do good. But if you are in that position already, this blog is probably useless for you anyway.
Today, I am 29 years old. I have $550K laying on my regular bank account (Just took our first major dividend) , another $100K in the capital markets, I have a substantial equity at a pretty successful company which I don’t really know It’s value but I am pretty sure that it is worth more than $350K. I don’t have any real estate assets on my name, no car, and I don’t really know how to invest my money. I just got married, and my wife is pretty modest, so we’re not spending a lot of money on things we don’t need. It is not part of any anti-consuming philosophy – We do like to eat in good restaurants and go abroad for vacations, but other than that, we’re not really into expensive cloths, brands and night life. My salary covers our life style + increasing my stock holdings a bit, but most of my savings are coming from dividends which we take from time to time.
As I am aware that I should invest my money and get some
yield on it, I might share in future blog posts about the investment decisions
I’ve made, but the point is that I am an entrepreneur with some success at a
young age, but I have no experience yet as an investor.