Home » Top 10 Mistakes Made by Entrepreneurs (Full Transcript)

Top 10 Mistakes Made by Entrepreneurs (Full Transcript)

Entrepreneur2: Well, I think it’s a frustrating answer, but it depends on the person. And there are people who are absolutely solo creators who have a very individual drive, and that’s the way they function. There are people who thrive and need a partner. I think the funny thing about, about startups is, this whole thing is driven by exceptions. You know, you can create any rule you like, you know, oh, you know, startups where the husband and wife are the founders together.  That always fails, well except for Cisco, you know, startups — I mean, no matter what you pick, there are always exceptions. So, it’s very hard to generalize out of those things. I’ve been involved in companies where there were kind of co-founders, and a founder and co-founders, and just a founder, and I think all of them can work. The most important thing, if you’re starting something yourself, I think it’s to ask yourself what’s the right thing for you? And just like with a lot of the other things that we’ve been talking about, it should really be a sort of organic process, I think. If you sit down and say, all right, today I need to go out and find myself a co-founder, that’s probably not going to succeed.

Entrepreneur3: I think it’s all about — it’s a couple of ways to look at it. Part of it is finding your dream team, and they’re all your co-founding employees, and that’s really essential for any startup. Your first five people, make it or break it to actually seeing if it’s going to survive. Your first 20 people, make it to see if it’s going to be a large company or not. And when you get to that standpoint, you got to go ahead and realize who your right partner’s going to be, and partner can be beyond co-founder, it’s really VC. And you know, just a short plug for Stanford. Stanford’s actually an investor in gWallet. So, I think we got — we picked the right investors for the right reasons. And partly, it’s because they can actually add a tremendous value. I mean, if you look at my first company, I actually took no funding whatsoever. I bootstrapped it. Mainly because nobody wanted to fund me. I was 16, 17, 18. So, no offense on that. But what I learned on the second time around is when I actually raised venture capital is it matured me as an entrepreneur. It actually brought a different perspective on how to grow a large company, how to actually sustain certain things that you do, international expansion and so forth and picking that right partner is key, because if you pick the wrong one, VCs can either add a lot of value, or they can take a lot of value out. So, that’s the caveat, no offense, but that’s the big formula into finding the right magic in that partnership.

Carol: Yep. So, the other part is whether or not to do it alone or in a team is also based on – if you need outside money, how are you going to get it? And in the venture world, one of the conventions is basically, never invest in a single entrepreneur. And the bottom line is, if the entrepreneur gets hit by a bus, what do we have? So, if you have at least two people on a team then, and one person gets hit by a bus, then at least, theoretically, there’s somebody to kind of go forward. And so typically, by the time you see them any entrepreneur company coming forth to a venture capital firm, you’ll see that they have gotten to a point where they have at least the outward appearance of being a team. Angels kind of go back and forth. And since I happen to straddle both communities, there are lots of angels that will fund a single entrepreneur. And then tell them, you have to go find other co-founders. But it depends on how much money you need.

Entrepreneur4: I think the question whether you need a co-founder or not, perhaps the most important thing is, who you choose as co-founder and in the heat of the moment or in the excitement of actually hatching an idea, I think that it’s easy to find somebody that is your soul mate right there and then, right? They’re all excited, oh let’s do this, and they all worked up about it. But if you and a co-founder are looking for somebody that can help you build a company long term, I think it’s very important to dive below the initial excitement, right? What is that person’s long term contribution? And what is that person’s long-term commitment and aspirations for the project? And when I’ve seen some start ups failing and succeeding, I see a lot of startups fail because the founding team was the wrong founding team. And the founding team did not have long term aligned objectives. And perhaps one was wanted to work really hard for a long time and the other one decided to — it was fun for a year or two but then later the person was not willing to work as hard anymore. They didn’t then have a shareholder agreement that regulated for whatever reason was going to happen down the road, creates a lot of tension, right? Then one person, that was a part of the founding team has a large stake with the company, but he’s really moving on to do something completely different. So, that can create a lot of, issues and problems for a company I think.

Entrepreneur1: And just to add on that, I think it’s pretty crucial when you actually find that person or find that your dream team is to find the right DNA that has the hunger because partly even when hiring, my third company. It’s, you would assume I would have the pick of the draw in hiring the best talent and fortunately there is that pool there, but it’s really, really hard when you can look someone in the eye and say is this person hungry or is this person just expecting a great outcome. Because any startup regardless, if it doesn’t guarantee an outcome and it’s really, really hard to go and find out that the consensus DNA isn’t going to go ahead and do what it takes to make the exit happen, or make the positive outcome happen. And probably 1% of the people I interview, I can see that hunger, 99% just don’t have it. So it’s really finding that 1% especially in that first five employees, especially when the first 20 employees because if you don’t you’re going to set yourself up for disappointments and failures.

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