Starting a Very Successful Business Means Making Many (Non-Fatal) Mistakes

The life of an entrepreneur, like the life of any adventurer, is a saga of mistakes, near misses and lucky breaks.  Any successful businessman who tells you that he got where he is solely through "careful planning, years of hard work and lots of help from a good team" is, in my humble opinion, lying through his teeth. 

Successful enterprise, at least in my experience, seem to be born from real insight, effective action, encountering other people with similar interests, compatible personalities, and interlocking skills, a hefty dose of very good luck, and the ability of an entrepreneur to make a long series of non-fatal mistakes.  In fact, one of the most important skills I think new business owners have to master early on is the art of making lots of little mistakes quickly and comfortably without making the kind of larger ones that put them out of business. 

Why Must You Make Mistakes?

Because entrepreneurship requires "engineering" an economic solution for yourself, your employees, your customers and those who provide your raw materials without nearly enough information.  There's no way you can really be entirely informed enough to make all the decisions an entrepreneur has to make.  If you spent the time required to research all the answers to all the questions you need to ask in order to avoid all mistakes, the vast majority of business opportunities would fly right by you.

So how can you learn how to make lots of little mistakes without making the big ones? Here are my top five tips . . .
 

• Know who you are working with.  Someone making a new brand of handbags is not going to know the properties of every textile on the market or the delivery capabilities of every possible supplier.  What they can learn is the track record of anyone they may be working with. Never be afraid to ask people for a list of people or businesses with whom they've worked. Never be afraid to call up and confirm the information they give you.  This is true for big customers, big suppliers, potential investors and possible employees.  While a successful track record isn't everything, the lack of any track record is a big red flag.  Trusting the wrong people with important aspects of your business can result in devastating losses.
• Recognize and learn from past mistakes.  Every business professional with any insight into themselves and their work will come to recognize mistakes they make over and over again. 
  For example, some people routinely fail to follow through on good business ideas.  They start businesses, or launch new products, then fail to implement them well. Those false starts are expensive.  They cost time and money you can't afford to waste.  To avoid them you have to start new operations only when you have a foundation you can really believe in and follow through on. 
  If you find yourself falling into the same traps over and over again, you must learn how to step back and figure out what feelings and thought process underlie those repeated failures. This will turn those unfortunate impulses into "old friends" you recognize but don't waste time on.
• Become comfortable assessing the size of opportunities and the magnitude of possible mistakes. Someone who runs a factory and chooses to cut corners on safety procedures and good employee training is probably a business professional who incorrectly assesses just how a death or dismemberment will impact his life, his career and his business.  Such a mistake, in most cases, will be catastrophic.  Against this risk, what might the cost savings associated with skipping that training be? Obviously they will be a small fraction of the potential loss in a worst case scenario. The "upside" just doesn't justify the "downside" in that scenario, so a good businessman doesn't take the risk. 
  Get used to running that calculation every time you make a big decision. What do you stand to win? What might you lose.  Stay away from big possible losses, especially those likely to reach outside the business into your personal or professional life. They almost always outweigh any potential gains.
• Get a team of experts you can afford on board. When you are contemplating something really major you need a company lawyer the way a mother with small children needs a family doctor. You need someone to call before things get really serious, or before really serious things become really expensive.  A bookkeeper or accountant, a friendly mature mentor with a track record of success, peers that work in your industry and other peers that work in other industries.  Consciously connect yourself to expertise you can call on when you need advice. This effectively broadens the number of good decisions you can make quickly and limits the number of fatal ones you are likely to make.
• Limit how just much you can lose by starting small. One of the reasons I encourage business owners to start their enterprises without outside investment or loans is because that really goes a long way toward limiting the size of mistakes most people can make. Given that an entrepreneur isn't insane, or viciously unlucky, starting an enterprise on a shoestring means the biggest mistake they are likely to make will cost them their shoestring, or maybe their shoe. They will probably get to keep their foot. The more money you have in a business, and the more you've taken from others based on promises, the more you you have to lose. 

To learn more about the real world practicalities of starting a solid business, I hope you will visit School for Startups online at www.schoolforstartups.co.uk. Our online and face to face events for startup and small business owners focus on what you really need to know about getting a good business off the ground and profitable. We have dozens of great tutorials and lots of informative videos on our site, and we add something new almost every day. You can also find out about new events and information by following us on twitter @s4startups or @s4stv.