20 Years is Not Enough Time to Know It All
This much became clear to me, after launching the marketing- and loyalty-services company Incendio.
I struck out on my own six years ago and became the “chief accelerant” following more than 20 years in the loyalty and customer engagement industry – many of those years as a marketing vice president at GameStop and Michaels. And during these years, the loyalty industry burgeoned, to 3.8 billion memberships, or an average of 14 programs per consumer.
Yet now, with 28 years of professional experience under my belt, I marvel at the disproportionate volume of what I learned in the last 72 months, which is a gentler way of acknowledging what little I knew about running a company back in 2015. I’ve tripped up more than a few times.
Experience Can Prevent You From Seeing Big Little Things
If I had to encapsulate all that I learned in a few words, it would be these: Don’t be afraid to say, “I don’t know.”
Incendio lucked out in talent and perseverance. We occasionally fell, but we would not accept failure. Still, when looking back, there are without question several things we would do differently. Here are six, one for each year of our success.
- Network excessively beforehand. If a starter-upper has not built an expansive network of contacts before launching, it’s too late. My rule of thumb is to have 500 solid, in-industry connections – who will return your calls! – before leaving a company. Doing so not only exposes the entrepreneur to a rich pool of talent and ideas, it also signals commitment to the field. Anything less signals that the entrepreneur is not getting out there. And while some senior-level executives may think they have the opportunity to bring clients with them, most do not. Starter Tip: Check how many contacts a potential competitor has on LinkedIn and compare yourself to them. HubSpot offers a good starter’s list of entrepreneurial networks (itself included).
- Set up shop in a larger, thriving city. It’s tempting for young entrepreneurs to live in smaller cities. They are more affordable, feel less intimidating and are not as competitive. But none of these features change the fact that bigger cities, or growing cities, present high earning potential because there are likely more opportunities and companies willing to spend. The price you can command for the same project changes by geography. This doesn’t necessarily mean fleeing to New York, Los Angeles or Dallas, especially with the now-standard work-from-home culture. There are a number of second- and third-tier cities that are growing fast, and websites that can help go-getters find the most promising – and the most overrated – hubs. Starter Tip: Entrepreneurs should go where prospect clients are headquartered or are likely to soon cluster (this includes ancillary businesses). Also, look for construction cranes – they’re an economic indicator of how healthy a city is. Construction signals growth.
- Be prepared to shift scale and manage money accordingly. I, like lots of entrepreneurs, came from a corporate environment with a big budget and access to services I had taken for granted. That goes away once you leave the building. Those striking out on their own won’t likely be able to call the same vendors, for example. They will have to find new partners. This work can slow income and cost money, and when that money used to be your $10,000 nest egg, it’s sobering. Starter Tip: Sock half of every dollar away for taxes, a rainy day fund and retirement. Speaking of retirement: open a SEP (self-employed) IRA, for the tax benefits. Wait? What? Now I have to pay quarterly estimated taxes? Speaking of taxes: get a good tax person. They should know the state and even city tax and licensing laws you don’t know. In Texas, for example, I have to pay a franchise tax. Who knew?
- Practice early entrepreneurialism. Many people strike out on their own after a long career and without any entrepreneurial experience. I am among those and frequently wish I had a younger “start-up” self to turn to for guidance. A side hustle, even if it’s selling crafts on Etsy or doing handy work on the weekends, helps one appreciate what it takes to earn and hold onto a dollar. It also can contribute to the nest egg that will support the future endeavor. Starter Tip: Don’t view the business only through the eyes of the founder. View it through the eyes of human resources, accounts receivable and IT. This will help distance you emotionally. Tactically, learn to use Excel spread sheets to record everything, know what is and is not expensable, and save every receipt.
- Never, ever work for free. It’s tempting to take on a “sample” assignment from Big Dream Client, thinking it’s an investment in a rich future. Fact check: There is no logical reason to assume a big company will hire you after you give away your services, talent and expertise. Once you’ve given it away for free, you’ve given it a value, which is $0. I’ve been asked over lunch to provide free budget advice and feedback on loyalty program ideas. These are expert services I spent decades learning and now make a living from. You wouldn’t ask a dentist for a free filling; why should professional services be different? Starter Tip: If you want to be charitable with your talent, do so in an environment that will pay in leads and emotional dividends. I work for free for my church and for a professional organization that is key to my business.
- Employ a “no a$$holes” policy. Remember, the freedom we seek as entrepreneurs includes that from people who set our teeth on edge, and that includes even the highest-paying clients. We once were courted by a fast-growing prospect who, after inviting us to meet several times, suggested that his business model was already too good to need our services. Yet later that day the company offered to hire us. I turned it down, knowing the company would likely require us to constantly justify our work, and that’s a terrible environment in which to do your best. Starter Tip: Difficult clients often reveal themselves while negotiating a contract. Work with people and clients who brings out a side of yourself you really like, trust your gut and always, always, always insist on a signed contract before you start working.
These Lessons Taught Me that I Still Have a Lot to Learn
Entrepreneurialism rewards us in so many ways, many of which can’t be measured in dollars. The revelation of learning all we do not know, including our own resilience, is priceless. Still, every day I encounter questions I still don’t know the answers to. Among them:
How do we effectively build and manage a sales pipeline?
What is the most effective way to direct traffic to our website?
When do we spend money on sponsorship activities?
And many more.
Starting up means pushing yourself into uncomfortable and often untested territories, and that takes courage. I wear many hats in my business, and I often work 12- to 14-hour days. But the difference is that when you’re doing it for yourself, it takes on a different shape than sitting in an office for those 12 to 14 hours. I’m happy to log the hours because I’m doing it in service to myself, our wonderful clients and the people who work for me.
In another 20 years, I expect to still be learning, to be falling down and getting up. But a scar from a scraped knee often tells a good story. It’s better than no story.