Sometimes the more you know, the less you do

Recently, I’ve been embarking on a new venture in a completely different industry. It’s a notoriously competitive industry with high rates of failure and turbulent forecasts — kind of like the startup realm itself.

As someone who’s founded and grown multiple profitable ventures in diverse industries — and helped thousands of others do the same, you’d think I’d be immune to the kinds of mistakes that devastate startups early in their tracks. Unfortunately, sometimes experience, aptitude, and ambition lead smart founders down stupid paths.

Thus, after nearly a year of proving the new venture’s concept — and profitably bringing in the big bucks doing so — I nearly talked myself out of the next pivotal step. Why? I succumbed to a few of the deceptive mistakes that so often lure astute, driven founders into the trap of self-sabotage and imminent failure. Here are 10 mistakes to avoid if you don’t want your preparedness and good will to slash your entrepreneurial success.

Let’s be honest: We all love a good failure story. In fact, there’s an entire media company dedicated to startup failures, and many of you probably found me through my first startup failure story that blew up. I’ll be the first to admit that learning from others’ failures is one of the best shortcuts to hopefully avoiding the pitfalls of our predecessors. However, there’s a catch — a big one.

There’s a giant difference between a failure story and a sob saga, and sometimes we unknowingly gravitate towards the latter to feel less alone. Misery loves company, right? It does, but that doesn’t make it healthy or productive.

I recently caught myself diving hours down the rabbit-hole of tragic tales detailing the countless reasons my new venture is highly unlikely to succeed. Though I’ve already proven the concept, with the cash flow to boot…

There’s one good reason to read failure stories: to learn what to and what not to do and attempt to engineer a better outcome and mitigate the pitfalls that plague many of our journeys. It isn’t, however, to commiserate about just how freaking hard startups or your particular type of business or industry is.

Binging sob stories and fear-mongering tragedies leads to doubt, which shakes your confidence, which delays your decisiveness, which impedes your action, which ultimately destroys your progress and demolishes your future success. Quit with the sob sagas; entrepreneurship is a live action adventure game to play, not a tragedy to passively absorb.

On the flip side, some of us have been sucked into the vortex of hustle porn-posting toxic positivity-boasting so-called entrepreneurs on social media. While these #entrepreneurs’ hustle hype can be motivating, it can also be distracting or worse, lead you into the dangerous den of comparison.

Plainly put, blindly devouring hours of toxic success fluff can be more detracting than additive to your progress. Plus, most real entrepreneurs didn’t get successful by scrolling, liking, and commenting on every #grind247 IG post. If you’re going to engage online, your time would be better spent engaging with your target customers; their opinions can actually move the needle for you.

The vast majority of entrepreneurs — myself included — suffer from a major blind spot in planning their business: They fail to consider the lifestyle and realistic day-to-day experience of the business they’re building.

I’ve built companies I hated, some I’ve tolerated, and others I’ve loved — and my feelings towards the businesses weren’t necessarily correlated with their success or profit. Instead, it came down to my required involvement, the day-to-day operations, the long-term vision, and what I was really bringing into the world.

Many well-meaning (well-researched) entrepreneurs get so wrapped up in solving the problem or creating the product or service that they run the risk of building a business they don’t even like. You may not see it coming, but if you wait until your business takes over your life to realize you don’t enjoy the new reality you’ve created, Houston, you have a problem.

One of the hardest decisions I’ve ever made was to shut down the tech startup I’d sunk my then-6-figure life savings into. I’d quit a Wall Street job, moved across the country with no income, and poured a year and a half (and over $100k+) into the business that was just about poised to take off.

And then I pulled the plug.

Once you’re months or 5- or 6-figures deep into a new venture, the commitment collar starts to tighten. You’ve gone this far, so you can’t possibly quit now! That’s the sunk cost fallacy hard at work, draining your bank account and shoving you down the path of cognitive dissonance towards imminent failure.

Commitment is great, but so is honest, objective, 360-degree reevaluation. Sometimes walking away is the smartest move, and sinking even more cash in really might be a pointless Hail Mary throwing good money after bad.

One of the worst words of warning I hear derailing new founders is “What about the competition?” It’s a fair point — we should all be aware of the competition in our industry reaching our target market; however, competition can sometimes be more helpful than harmful.

Competitors give us public access into their marketing funnels, their pricing, their customer expectations, and pretty much offer a cheat code of free intel.

Competitors who talk a big social media game have you convinced they’ve blanketed the market, but in reality, social media doesn’t necessarily mean sales. I run 6+ figure businesses that have virtually no social media presence — and these are online businesses. I also know of multiple direct competitors whose social media channels are on fire all day long, yet their sales are limping along, and a few have even closed their doors permanently.

I hate to burst your bubble, but there probably is competition. The good news? Healthy competition makes the business world go round, and there’s often room for an innovative newcomer to shake things up.

Perhaps you took preparation one step further than your product-obsessed peers; you’ve gone so far as to learn the in’s and out’s of the venture capital and fundraising space. Shark Tank whet your whistle, and now you’re a pitching expert. Ready to start applying for accelerators and cold-emailing venture capitalists, right?

Wrong. As someone who comes from the finance space and has both a formal educational and real-life practical understanding of startup fundraising, I can assure you this has very little to do with building a successful business. If you fall in love with pitch deck analysis, you may be better-suited to a role as a VC analyst than a founder. Alternatively, as a founder, putting your pitch or the fundraising process before the problem you’re solving is a problem itself.

You fundraise once — or maybe a handful of times (a dozen at most). You have to create the product or service and subsequently market, acquire, and convert customers an infinite number of times to grow a successful business. At the end of the day, selling to customers is more important than selling to investors.

Why is Amazon so successful? There are a lot of reasons, but two prime (pun intended) reasons customers willingly shop there (or have a membership) are speed and convenience. It’s a convenient hub of a ton of vetted products with hoards of reviews, and the shipping is usually faster than the alternatives. Those two reasons (speed and convenience) are also valid in the startup space. For example:

• I pay for the software that conveniently manages my customers and delivers them our products and services
• I pay an absurd amount for productivity-accelerating tools that exponentially magnify the speed at which we can market and sell

Thus, if you’re paying for tools that make running your business more convenient or efficient for either your team or your customers, great! However, there’s something else you really shouldn’t be dishing out thousands for — at least not at the start: the magic bullet experts.

What am I talking about? I’m talking about the branding experts, marketing teams, and social media whizzes who claim that for just a few thousand dollars a month, they’ll work some magic that will supposedly make it rain.

I’m not suggesting you should forever abstain from hiring a marketing team; however, if you decide to pay your shortcomings away to mysteriously skilled experts, you may be bankrolling their months of trial and error. Rather than deem yourself too inexperienced or inefficient to tackle a skill like advertising, and thus hampering your value-add and shackling your company with a high burn rate, you’d better invest the time to learn that skill yourself. Learn first, outsource later; paying your problems away shouldn’t be a beginner’s shortcut.

Have you ever heard the saying that you should surround yourself with the 5 people you’d want to be like? While that may provide a positive gravitational field of motivation, it actually isn’t the most helpful company to keep at the beginning of building your business.

Instead, you should really surround yourself by your customers to get a deep understanding of what they’d want. Standing next to Gary Vee may pump you up in the moment, but if you’re selling products to carpenters, you might get a higher ROI from watching some HGTV and phoning a few local woodworkers.

Smart, humble, honest founders have one major disadvantage in comparison to their more arrogant, confident, narcissistic peers: They may let reality-rooted imposter syndrome talk them out of their very own business.

While we should all strive to become experts at the product or service we sell, we also all start from somewhere. You can shadow, partner with, or hire a more experienced expert or take the plunge of learning as you go, but if you wait until you’re the most knowledgeable person in your field, you just may delay your venture indefinitely.

If you consider yourself an ambitious entrepreneur then you might also be a perfection-seeking tinkerer. In other words, you want to keep working, adding, and iterating on a product or a project until it’s just right — which is obviously never. Years ago, I was in those exact same shoes with an innovative pre-Patreon-OnlyFans hybrid with real micro-celebrities as live partners.

Since we had high-profile talent signed on and were up to the task of pleasing their multi-million-follower audiences, the product had to be great. We spent the time and money to add on all the bells and whistles, accommodating a plethora of potential future talent and user requests. After sinking tens of thousands more dollars into these nice-to-have surprise features, guess how the talent reacted?

Crickets. Not just crickets, actually; annoyed crickets. Ironically, the talent didn’t like the forward-thinking features we’d added, since they had the potential of requiring a bit of their time. Think today’s Cameo features built into an earlier education-focused Patreon. In theory, it was a great idea: More talent interaction for users and more income potential for talent. In reality, the talent we got — at the time — just wasn’t that hungry for it. They wanted those features muted or deactivated, since they were hoping for a low-effort cash grab, while we were positioning them for income maximization.

Long story short, foresight isn’t always 20/20 in hindsight, and overbuilding can waste your money and time on tools and features that clunk up the user experience, incite a dull reception, and fail to recoup a profitable ROI.