10 lessons from 10 years of entrepreneurship

10 years ago I started my first company. I've been running multiple businesses and invested in even more since then. Here are 10 non-obvious things that I wish someone had told me when I first started.

1. Be patient

Every first-time entrepreneur dreams of building something great [footnote define great] and almost everyone thinks it's going to happen quickly. So did I.

When I sold my shares in Devies after four years we were around 30 people in the company. Four years after that my former cofounders had grown the company to 130 people. Fast forward another four years and I'd be surprised if they weren't >300 people [footnote no pressure].

Said differently that's four years to get going, four years to get growing and another four years to get great. That's 12 years of grinding.

Be patient.

2. It's all about the people

In the beginning, I was even more arrogant than I am today if you can believe it. I thought my success depended on how good I was at building Android apps.

Turns out that was only about 10% of what I needed to build a successful business. Don't get me wrong, those 10% are important. But building a business is more than writing code.

It's talking to customers, talking to stakeholders, talking to recruits, talking to cofounders, talking to users, talking to employees, talking to other entrepreneurs. In short, talking to a whole lot of people.

All those great companies that you see? They are made up by a bunch of people. That founder that you look up to? He or she is just a person too.

If you want to get good at business you need to get good at people.

3. Focus on profits

Every business needs to make a profit at some point. It doesn't matter if you're running a yoga center [footnote urban om] or a venture-backed startup. In general, it should do so sooner rather than later.

Ten years ago I was focused on growth over profits. What this leads to though, is a chase on top of the grind. You're never really happy until you've grown enough to make a big exit. Following the first lesson in this post, that's 12 years of not really being happy.

A little-known fact is that the reason I was able to start angel investing was that we focused on profits and were able to pay ourselves dividends. I'm forever grateful that my cofounders didn't listen too much to my talk about growth over profits.

4. Trust your gut

Your brain is exceptional at taking information and mapping it against everything that you have experienced in your life. This usually shows up in the form of a feeling in the pit of your stomach or a gnawing sensation in the back of your mind.

This feeling could tell you that the person in front of you is not to be trusted or that you should go left instead of right. Learn to lean into this feeling. As you get more experienced you'll also be more right.

Trusting your gut will enable you to make decisions with incomplete information. This is important, because as an entrepreneur you will never have all the information that you think you need.

5. And verify with data

Some decisions are one way doors. They are the types of decisions where if you get it wrong you're company is done.

You can't afford to leave those to your gut, because the downside risk is too high.

6. It's a game of contradictions

Starting a business you need to get good at keeping two conflicting thoughts in your mind at the same time. You need to think about the long-term vision AND how to best negotiate the deal in front of you. You need to be patient and move fast when needed. You need to take risks and be cautious at the same time.

The sooner you understand this the faster you'll become good at switching between the two, which in turn will make you more effective at running your business.

7. The process is the products

Software is malable and easily copied. Process is how you keep innovating

8. Cash is king and cash flow is queen

Companies die because they run out of cash. Period. Keep track of where your cash goes and how long you could keep running your company if every customer disappeared tomorrow. This might sound dramatic, but it was exactly what happened to a lot of companies when covid hit in 2020.

A good rule of thumb is to keep enough cash in the bank so you can go three months without a single dollar coming your way. When starting it can be difficult to have a reserve at all. Adjust up or down as you see fit.

Selling something where you don't see payment until days or months (common in service based businesses) later can be dangerous. You can't pay bills with receivables, so keep track of your cash flow. Getting a line of credit from the bank is a cheap insurance against customers failing to pay on time.

9. Being an entrepreneur can be lonely, but it doesn't have to be

Most people who have never started a company think we are a bit mad. We invest our body and soul into a venture that usually runs at a loss the first months to years. Once we start making a profit our hourly rate sucks because we now work 80 hour weeks instead of the normal 40. And if we hit a spot of bad luck we can lose it all in an instant. [footnote apple viktor]

If you've never been in it it's hard to grasp how the pressure of the grind takes a toll on the entrepreneur. Not all families can relate to a conflict with a customer or employee. Not all friends can relate to the stress of seeing an empty bank account the day before payday.

First-time founders rarely have a support network setup to deal with the loneliness that follows. Fortunately, there are groups and networks that you can join. I'm still in contact with some of the founders I met through Founders Alliance and paces like Walborg Ventures rents you a desk while providing a community for like-minded.

If you live in a rural area or just don't want to meet people in person, then Twitter is great for connecting with people. #buildinpublic is filled with awesome people sharing their journeys as they build their dream life.

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