The Women Entrepreneurs Blog @ Simon

Ask the Entrepreneurs: What Would Warren Buffet Say?

[Note: Students in the Entrepreneurship program at Simon have submitted a number of questions and we encourage you to ask yours via the form on our Home/About page. We'll have one or more of our bloggers offer their takes — which should provide starting points for your thinking and more discussion.]

Question: What do you think are the 3 most critical skills a new business owner must have and why?

1. We are back to another Warren Buffet quote (as in my earlier Q&A post) on this one:

   "It's better to hang out with people better than you. Pick out associates whose behavior is better than yours and you'll drift in that direction."

   I think that one of my best business skills is recognizing the areas in which I am weak and hiring people to compensate for my weaknesses. I do what I do well and find other people to do what I am poor at doing.

 

2. And more from Mr. Buffet:

   "The business schools reward difficult complex behavior more than simple behavior, but simple behavior is more effective."

   It comes down to patience, problem-solving and common sense. If these are not qualities that you have developed, you should.

 

3. Although this one may appear to conflict with Mr. Buffet’s comment about business schools above, I believe you should get an MBA and/or have many years of business experience.

Ask the Entrepreneurs: Make Their 3 Worst Your 3 Best

[Note: Students in the Entrepreneurship program at Simon have submitted a number of questions and we encourage you to ask yours via the form on our Home/About page. We'll have one or more of our bloggers offer their takes — which should provide starting points for your thinking and more discussion.]

Question: Having successfully run a business for several years, what are one or two difficulties in starting a business that many budding entrepreneurs overlook or fail to consider?

One difficulty in starting a business that I believe entrepreneurs fail to truly consider is their “point of differentiation” and how to articulate it and market it. Many entrepreneurs jump in headfirst trying to do a million things without the clarity and focus that you need.

For example, one thing that helped me “create” my points of differentiation was that I did a mini focus group with clients. I interviewed 10 CEO’s from small-sized companies, 10 CEO’s from medium-sized companies and 10 CEO’s from large-sized companies.

I asked them for six items: What are the top 3 things you love and can’t live without from your current advertising agency relationship and what are the top 3 things that just make you crazy?

Whew … the CEO’s were hard pressed to tell me the things they loved!

But they were quick to respond to the 3 things that got under their skin. And, the most interesting thing was that those things were all the same … didn’t matter about the size of the company.

Those 3 things became our points of differentiation and 20 years later remain!

Ask the Entrepreneurs: What, me worry?

Note: This question came in via email from one of our readers. We encourage you to ask yours via the form on our Home/About page or the email us. We'll have one or more of our bloggers offer their takes — which should provide starting points for your thinking and more discussion.]

Question: When you first started your own business, how did you get over that initial "what if" fear? I am interested in starting my own retail store and I understand the business of networking and how to bring in clients (I used to be in Sales), however, in the back of my mind I keep hearing, "what if customers don't come" and "what if I fail"? I believe in myself enough to know that this is what I want eventually and to know that I am capable of doing it, but I can't seem to get this thought out of my head. I was just curious if you had any suggestions.

With apologies to Alfred E. Neuman, when I first started my business I can remember worrying about how much discount I should give friends. How much would be too much? How much would insult them? And so on. As it turned out, they all wished me well with my adventure, but none of my friends ordered. What a waste of time that line of worrying was!

If you want to be in business for yourself, get used to the "what if" fears. They will become a part of your life. And, like my example above, the things you worry about will probably not be worth the worrying — and the things you don't worry about will pop up and give you real things to worry about.

This probably sounds like a mish-mash of words, but the best advice I received when starting out was "trust your instincts." No one will ever know your business as well as you, and you will be learning something new about your business every day.

The customers will come, but not the ones you anticipate.

Your business will evolve in ways you could never plan for.

Worrying is something entrepreneurs excel at — and eventually, probably thrive on. We are a unique breed.

Shakespeare didn't have to deal with software suppliers!

[Note: Students in the Entrepreneurship program at Simon have submitted a number of questions and we encourage you to ask yours via the form on our Home/About page. We'll have one or more of our bloggers offer their takes — which should provide starting points for your thinking and more discussion.]

Question: What's a mistake you made while starting your business and what have you learned from it?

Maybe I can get Cindy Hirschberg and her lawyer friends off the hook! (See her post on the value of finding a good business lawyer.)

I seem to be terrible at selecting software infrastructure suppliers. With only one exception, every supplier that we have used has been months to years late delivering their product. Their inadequate performance has threatened the very existence of our company and cost us tens of thousands more than I could have ever anticipated.

I am not sure if I have learned my lesson — other than to beware. I haven’t figured out how to prevent this from happening again. It seems to a universally horrible experience for everyone. Does anyone know the secret to picking software vendors? Or is just a fact of business life that all "go-lives" are painful, late and expensive?

Ask the Entrepreneurs: Three Tips from My Father

[Note: Students in the Entrepreneurship program at Simon have submitted a number of questions and we encourage you to ask yours via the form on our Home/About page. We'll have one or more of our bloggers offer their takes — which should provide starting points for your thinking and more discussion.]

Question: What do you think are the 3 most critical skills a new business owner must have and why?

I will pass along the business advice that has served me well over the last 20 years. Now, understand that this advice came from my father who owned a trucking business for 40 years. He didn’t go to college … never took a business course, but Thomas Dixon was hugely successful in life in so many ways!

Here’s his advice:

Ask the Entrepreneurs: Beating the Business "Divorce Rate"

[Note: Students in the Entrepreneurship program at Simon have submitted a number of questions and we encourage you to ask yours via the form on our Home/About page. We'll have one or more of our bloggers offer their takes — which should provide starting points for your thinking and more discussion.]

Question: Name two or three important characteristics that you seek in a partner that provides a substantial amount of capital for your business.

There are so many things to consider in partners that invest capital in your business. Partnerships in business are critical for any company’s success, but can be just as difficult as any marriage. I could argue, in fact, that business partnerships are more difficult than marriage because most marriages begin with a strong emotional and idealistic commitment. Business partnerships are usually based on simple economics so the fundamental basis of the commitment isn’t as strong. I wonder what the five-year failure rate of business partnerships is? I bet business partnerships fail at a higher than do marriages!

Ask the Entrepreneurs: My Biggest Mistake? Hiring "Clones"

[Note: Students in the Entrepreneurship program at Simon have submitted a number of questions and we encourage you to ask yours via the form on our Home/About page. We'll have one or more of our bloggers offer their takes — which should provide starting points for your thinking and more discussion.]

Question: Describe to me a mistake you made while starting your business and what you learned from it.

The single mistake I made while starting my business what that I hired "like minded" people, "Lauren Dixon clones" — people who were in the office at 4:00am and worked crazy hours. Work was life. Life was work.

Ask the Entrepreneurs: Overlooking the "Mousetrap Fallacy"

[Note: Students in the Entrepreneurship program at Simon have submitted a number of questions and we encourage you to ask yours via the form on our Home/About page. We'll have one or more of our bloggers offer their takes — which should provide starting points for your thinking and more discussion.]

Question: Having successfully run a business for several years, what are one or two difficulties in starting a business that many budding entrepreneurs overlook or fail to consider?

"If a man can write a better book, preach a better sermon, or make a better mousetrap, than his neighbor, though he build his house in the woods, the world will make a beaten path to his door."

—Ralph Waldo Emerson

To me, it is this famous “mousetrap fallacy” that leads to the doom of thousands of start-ups every year. It seems to be particularly common among the aspiring “high tech” entrepreneurs. Some engineer or scientist develops some new widget that does this really cool thing but they have no idea whether or not there is any potential need or demand for the product.