by mikekarnj on January 3, 2010
2010 is finally here and I think it’s going to be one of the best years yet. I have friends traveling around the world, raising money for their startup, and others questioning conventions and the status-quo (hopefully to launch their own startup)!! As we move into 2010, I thought I would share what I learned in 2009 from the many mistakes I made (there are many) and the mistakes I avoided. My goal is to provide some guidance for younger entrepreneurs because these are all things I wish I read a year ago. I hope you find some of these useful.
1. Focus on focusing. I spent the majority of 2009 “incubating” startup ideas and spreading myself way too thin. Chris Dixon wrote about the trap that many entrepreneurs face with incubators. ”The appeal is the idea that you can do not just one startup but many, and just focus on the “fun stuff” in each one (idea generation, product features, strategy, etc).”
In 2009, we launched By/Association, TBD, and Lovely Day while growing The Feast and All Day Buffet from the previous year. (You read that right. I was involved with 5 different companies.) When things weren’t going as well as planned with a new venture, we just launched a new one. We fell into the “that’s a great idea, let’s launch something and see what happens” trap.
“People think focus means saying yes to the thing you’ve got to focus on. But that’s not what it means at all. It means saying no to the 100 other good ideas that there are. You have to pick carefully. I’m actually as proud of the many things we haven’t done as the things we have done.” — Steve Jobs (h/t Caterina Fake)
If I could this all over again, I would have said NO to the majority of projects and ideas. By spreading myself thin over many different projects and startups, By/Association never got the love it needed to take it to the next level (Since then I have stepped down from the other startups to focus in 2010). I learned that success equals 1% idea and 99% execution and perspiration, so focus on the 99%. Saying no is more important than saying yes.
“So often people are working hard at the wrong thing. Working on the right thing is probably more important than working hard. — Caterina Fake”
Working on the wrong things are very, very, very costly for entrepreneurs. In 2009, I found myself running around like a chicken with his head cut off. I read almost every article on “re-iterating fast” and how “business plans were dead” so I took the advice and went with the flow and planned accordingly. It ended in disaster for me. I ran around in circles. It was like I was driving 90 MPH on the highway without a final destination. Looking back, I realized that I could have efficiently spent that time moving the ball forward for a plan with an end-point.
Having an end-point is essential for your business and personal goals. Yes, it can change. And yes, it probably will change. But thinking about a strategy will set you in a direction to achieve your goals and milestones. By committing to something in the future, decision-making in the present becomes much easier. It’ll save you money. And make you even more. That’s a win-win in my book.
3. Trust you gut. Timing is everything. We launched By/Association in July of 2009, and it’s been growing and gaining traction every month, which is really exciting. We have some big plans for 2010 which resulted from two major decisions we made: 1) We turned down a small amount of investment money; and 2) we didn’t touch the website for nearly 6 months other than fixing bugs and changing marketing copy (this was on accident because of lesson #1).
As many of you know, I play a lot of poker and part of being a good poker player is trusting your intuition. Most amateur poker players don’t follow their gut, and lose a lot of money in the process. At the end of the day, the timing wasn’t right for By/Association. We turned down money because we didn’t know where we were going. There was no plan. The product/market fit was nowhere close to 40%. And most importantly, my gut told me to sit back and wait for a better spot to “go all-in.”
If we took the angel investment to build what I thought should have been the next version of By/Association, we would have wasted a lot of time (refer to lesson #2) and built something that would have ultimately been thrown in the trash. Rather than re-iterating fast, quick, and deploying new versions every 2 weeks; we decided to think about the overall bigger picture by observing trends and talking to our members. This resulted in a better concept that solved all of the major holes in the older version. How do I know this will work? Because my gut’s telling me that the timing is right to build the next version, achieve product/market fit, and scale up.
4. The power of time off. Stefan Sagmeister recently spoke at TED about the power of time off. ”Every seven years, designer Stefan Sagmeister closes his New York studio for a yearlong sabbatical to rejuvenate and refresh their creative outlook.”
After producing and curating The Feast in October, I took the next month off to really think about my 5-year plan. Let me rephrase. I took the next month off to commit to something for the next 5 years of my life. Making this type of commitment takes a lot of self-reflection and soul-searching which can only happen when you take a 50,000 feet view as a lens for the future. It won’t happen if you have a lot of the same day-to-day distractions i.e. running your business.
I spent some time in Maine and New Orleans thinking about all the opportunities that I could take in my life. I talked to all my mentors, advisers, and friends (who were very supportive so thank you). And I emerged with a clear understanding and direction for 2010 and beyond. Taking time off is essential in making the right decisions, which leads to my next lesson.
5. Always make the best decisions. Lastly, a real quick story to wrap things up. Earlier in the year, I had breakfast with Annie Duke (professional poker player) who told me a great life lesson and story around sunk costs. In the most basic terms, the concept is used in making good decisions (which is the secret to the success of professional poker players). Wikipedia defines sunk costs as “costs that cannot be recovered once they have been incurred.”
So, for example, if you’re waiting in line at the grocery store, and the line next to you moves faster, most people won’t hop over to the faster line because of the time they “invested” in their current line. This makes absolutely no sense as anything invested in your past shouldn’t influence your future. Another example revolves around relationships. Most people stay together because they’ve “been together for the past five years.” Again, people shouldn’t make decisions based on past investments. And if you’re wondering how this applies back to poker. Once you make a bet and put your chips in the middle, that money is no longer yours (so you shouldn’t make bad decisions on getting it back).
Instead, you should look toward the future and look at all the different paths, opportunities, and possibilities presented to you right now. The sky is the limit. Everything in your past gets you to this point but it’s up to you to make the best possible decision on which path you want to go down. Because at the end of the day, if you make the right decision for yourself, there’s no way that it’s a bad one.
As we move into 2010, I hope many of you swing for the fences because entrepreneurs can and will change the world. There’s nothing wrong with making mistakes. It’s a rite of passage to becoming successful. And to close, remember, “there are no ceilings. Only the sky. The sky is the limit.” – Lil Wayne (via Notorious B.I.G.)