The most significant difference I’ve observed in all the companies I work for on success versus failure is the ability of the entrepreneur or business to execute. It frustrates me to watch friends and fellow entrepreneurs not realize their success simply because they don’t execute. Fear and greed are the two things I see that stop entrepreneurs.
Here are a couple of examples:
Entrepreneur A: The Stalled Visionary
Entrepreneur A has an excellent working product but is undeveloped, unbranded, and not ready for primetime. For 3 years now, he’s been spinning his wheels. He’s got prospects hot, and then they cooled down. He’s had opportunities for talented partners but wasted their time and eventually turned them off. He’s micro-managing legal paperwork, marketing, and everything related to the company because he thinks he can do it all. 3 years.
- Let’s say this company will be worth $500k in a year. To date, that means that they’ve lost over $1 million because of their inaction.
- Let’s say the company is valued at $5 million. The owner doesn’t want to give up significant company shares to those who can help him get it off the ground. He thinks if he gives up an additional 10% in ownership, he’s giving $500k to the partner. Remember that $1 million in lost revenue? Because he didn’t give $500k to the partner, he’s now lost $1 million in revenue… with the majority of that money being his. That means his stubbornness in negotiating a lower percentage costs him money. Weird economics, I know.
- Of course, the actual percentages mean nothing until there’s revenue behind it. And as long as he can maintain majority ownership, he gets to keep most of the business value. 100% of a company making $100k a year is $100k. 51% of a company making $500k a year is over $250k per year. Who cares if your partner will pull in an additional 10%… if it’s growing your bottom line 250%?! You’re not sacrificing anything, your company is valued better, and you’re making more money.
Entrepreneur A never gets his business off the ground. Or, if he does, it’s built with people who don’t have anything invested in the company, so it’s lackluster and doesn’t take off. 10 years from now, he’s still scratching his head on what went wrong – perhaps blaming the talent around him, not realizing it was his choice.
Entrepreneur B: The Fearful Protector
Entrepreneur B is scared. He has an okay product with copyrights, trademarks, and patents. He’s spent a fortune on attorneys and spends his time scouring the Internet for those people who might be utilizing his trademark in violation. He won’t work with anyone for fear that they’ll steal his idea. He doesn’t trust anyone. Because all his money is tied up in legalities and his time is spent watching for people borrowing his idea, his product never progresses.
Something better comes along and buries Entrepreneur B. He wonders what happened to this very day.
Takeaways
Some lessons illustrate the dangers of fear and greed, emphasizing the power of trust, collaboration, and decisive execution:
- Execution is everything: A great idea or product is worthless without action to bring it to market effectively.
- Value collaboration: Trust and partnerships can accelerate growth and success beyond solo efforts.
- Ownership percentage is relative: Owning a smaller share of a thriving business is better than 100% of a stagnant one.
- Don’t let greed limit growth: Holding onto equity too tightly can cost you more missed opportunities than you gain in control.
- Fear stifles progress: Worrying too much about competition or theft can lead to inaction and missed market opportunities.
- Focus on revenue, not perfection: Spending years fine-tuning every aspect of your business often means losing time and money that could have been earned.
- Leverage strengths, hire for weaknesses: Acknowledge your limitations and bring in skilled partners or team members to fill the gaps.
- Trust drives scale: Success comes when entrepreneurs trust others to execute their vision.
- Protect strategically, not obsessively: Legal protections are important, but they should not consume all resources or hinder product development.
- Act over idealize: The market rewards those who execute quickly and iterate, not those who linger on an idealized version of their business.
- Create shared success: Empowering others to succeed alongside you can amplify your growth and establish long-term loyalty.
Successful entrepreneurs don’t let greed or fear get in their way. They recognize their professional weaknesses and find talent to overcome those. They don’t care if every employee becomes a millionaire in addition to their wealth… in fact, they relish the opportunity to create wealth for others. They also don’t waste time on the competition or the naysayers… they execute, execute, execute.
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