Entrepreneur YOU!

Where to Start in Starting Your Own Business

Posted in E Essentials by Robert Lindsay Thompson on May 14, 2011

Staring your new business

I was recently invited to teach a class on “how to start your own business” by the Imam (leader) of the local Mosque where my (newly graduated) eldest son attends. It was decided that a two hour class on a Saturday afternoon after prayers was the preferred venue. The presumed audience would have a smattering of experience. Like most folks who want to start and own their own business… they probably have some history with an MLM (multi-level marketing) company or two. Maybe worked in a front line position in retail sales.

Where do I start? I’ve been an entrepreneur for 30 years+. Most of what I’ve learned has been from the streets, the “school of hard knocks”. I’ve been a millionaire twice. Bankrupt twice. As I’ve told my daughter who is interested in starting her own business, “You can learn from me how to start a business and how to make money… but you’ll have to go somewhere else to learn how to manage it and keep it.” I’ve been interested for some time now in translating my practical experience into terms that can be helpful to the “average Joe” (or Joan). I’d like to help other would be entrepreneurs to bring their respective visions to life.

I have a contempt for academia. Going to a University to learn how to start and run a business is like reading about military science and war history to become a good fighter. Who would you want in the fox hole next to you in a fierce battle? The guy who got an “A” in his class on Military Strategy and Operations or the 10 year veteran Sergeant? That being said, what practical “take away” skills can be imparted within two hours? How can I make use of this time to create the maximum potential benefit for attendees.

It takes a village to grow a (brain) child

I came up with this: Owning your own business is like marriage. You own it… but it owns you too. It’s not like a job where you can just put in time. Think marriage, not dating. You’re going to invest your heart and soul, not just your money. Its going to take a 100%. To make it work, it’ll take passion and persistence. Like marriage; when it’s good, it can be very good. When it’s bad… it can be hell. Therefore, you must pick your potential partner very carefully. To pick the right partner, you have to know yourself. To pick well, know well.

The first place to start is a (fearless and thorough) personal inventory.  See my early posts on Using your “identity compass” to find your own “true north” in business and Personal Inventory: Your Entrepreneurial Strengths & Weaknesses. Once you have an idea of the business venture you would like to embark upon, you need to write it all down…  in not more than one page.  The process of writing it down and limiting it to one page will help you clarify and refine your vision.  Finally, distribute the result to a couple of trusted friends.  Ask for their honest feedback and support.  It takes a village.  You will need both cheerleaders and critics.  I prefer the former.

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The best investment strategy for Entrepreneurs (and normal folks) to take in uncertain times.

Posted in E Essentials, Personal Journey by Robert Lindsay Thompson on February 26, 2011

Where is the best place to invest your dollars?

Life is wrought with uncertainties. There are a million investment strategies out there. Which one is right? No one can accurately predict what will happen in the future. I can assure you though; things WILL get better… or they won’t.

In 1988 the Wall Street Journal began a contest that was inspired by Burton Malkiel’s book A Random Walk Down Wall Street. In the book, the Princeton Professor theorized that “a blindfolded monkey throwing darts at a newspaper’s financial pages could select a portfolio that would do just as well as one carefully selected by experts.”

By 1998, the WSJ had run the contest 100 times, pitting Wall Street Experts against blindfolded WSJ employees randomly tossing darts at stock tables plastered against a wall. The results were interesting: The darts won 39% of the time! The pros losing almost 40% of the time to a bunch of darts certainly could be viewed as somewhat of an embarrassment for the pros. Additionally, the performance of the pros versus the Dow Jones Industrial Average was less impressive. The pros barely edged the DJIA by a margin of 51 to 49 contests. In other words, simply investing passively in the Dow, an investor would have beaten the picks of the pros in roughly half the contests (that is, without even considering transactions costs or taxes for taxable investors).

The book of Ecclesiastes states, “The fastest runner doesn’t always win the race, and the strongest warrior doesn’t always win the battle. The wise sometimes go hungry, and the skillful are not necessarily wealthy. And those who are educated don’t always lead successful lives. It is all decided by chance, by being in the right place at the right time.” In another version; “but time and chance happen to them all.” Bottom line is that we are NOT in control.

Notwithstanding, you can still develop a solid investment strategy. I believe, THE very best investment you can make is in yourself.

Investing in yourself is the best investment you can make

I’ve always co-sponsored my kids investment (matching their cash contribution) toward education, international travel, pursuing a particular passion or starting up a business. I think that education and personal development pay rich dividends… not only monetarily.

I disagree with the prevailing wisdom of using OPM (other peoples money). For one thing, most savvy investors aren’t going to give you money unless you have “skin in the game”. It takes a 110% commitment to launch a business. As the saying goes, “where you treasure (money) is, there will be your heart (passion) also”. That is not to say that you have to risk everything to start a business. But a half hearted (safe) approach won’t work either.

The “passive” investments I’ve made in times past- in real estate, in other peoples businesses or in the stock market have never turned out well. I’ve learned that the best use of “seed” capital is to plant them seeds myself. >To remain engaged in the process of cultivation and harvest, versus to turn over my seed to other “farmers”. Just like it’s not a good thing to permanently delegate parenting responsibilities. It’s not the best thing to give up the stewardship of your money to someone else either.

Therefore, my opinion is invest in yourself first; your education, your personal development, your own business, your own enduring passions. Invest in those you love. And, if you still have money to burn, pay off your debts. Liquidating high interest loans /credit cards is usually the superior investment strategy.

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Discovering the right timing for your entrepreneurial enterprise.

Posted in E Essentials by Robert Lindsay Thompson on January 19, 2011

There is a time and a season for every purpose.

As an entrepreneur, I’ve always felt that my vision is 99% accurate. I “see” something in my minds eye that needs to be created or done but has yet to be evidenced. I get a picture of it. The picture or vision of it becomes more distinct as I travel towards it. Brick by brick, I construct the enterprise, product, marketing piece, creative project, personal adventure that I have envisioned. I am and have been a man of vision. My life (personal and vocational) has been all about seeing and creating things that have never existed before… and helping others do the same.

However, my sense of “timing” has never been as acute. In fact, sometimes, it has really sucked. In the late 80’s /early 90’s I was able to achieve what few were able to do, which was to lose a lot of money in the southern California real estate market. I seemed to have an uncanny sense of buying at the top of the market, and selling at the low point. During the raging China Bull market of the 90’s, I was able to lose a small fortune chasing newly minted China “B” shares, offshore managed China funds and other “leveraged” financial products focused on it and other, small emerging markets.

True, I’ve been a pioneer. I once built what became the largest independent motion-picture studio complex in a bedroom community 30 miles from Hollywood. It become the first of literally hundreds of entertainment related companies that now proliferate the region. The first years were arduous and painful. I had an idea that was “before it’s time”. I didn’t “catch a wave”, I created a wave. I’m sure that many of the companies that have ridden that wave since have profited much more than I ever did.

In my last business, I put together complex data depicting international trade and traders in a way that had never been done before. The software that I, and my small team innovated, over years of constant development, far exceeded that of any competitor – despite them having 10,000 times the money and 100 times the staff. However, being first and best doesn’t necessarily translate into commercial success and retained wealth.

In the last case, a very prestigious venture capital group, had agreed to bring $20 million in capital and another $20 million in sales /joint ventures. The plan was to go public within 3-5 years. A deal was drafted in the fall of 2008. Literally days before we signed the final documents, along comes the global meltdown that devastated world financial markets as well as our plans. 18 months later, in the wake of vastly diminished sales and bleak economic conditions, the company was sold for a fraction of it’s 2008 valuation. Timing.

So, what’s the lesson learned? For me it is: Without “vision” you will never create anything. However, without “timing”, you won’t make much money.

The question becomes; how does someone know the proper time or season to launch a business, to strike out on their own?
To expand their business, to even when to lay people off? As the Kenny Rogers song states, “You gotta know when to hold ’em, know when to fold ’em, know when to walk away, know when to run?”

Obviously, I don’t have THE answer for every entrepreneur that will fit every business case. Notwithstanding, i think it is important to at least consider the times and seasons… that contextualize your business, of your product /service, of your market… as well as the changing times and seasons that influence your personal life and heart… before making significant (potentially life /business changing) decisions.

As one author puts it, “no one knows the times or seasons; time and chance happen to all.” On the other hand, it is good to check the weather forecast, before launching your boat.

Using your “identity compass” to find your own “true north” in business.

Posted in E Essentials by Robert Lindsay Thompson on January 15, 2011

So you want to be an entrepreneur? Well, the first thing, other then learning how to spell the freakin’ word correctly, which takes some rehearsal, is figure out where you’re at and where you wanna go. This may seem obvious to some, but really, it us usually overlooked. Imagine you wake up in the middle of an unfamiliar wilderness. First thing you’d do is take stock of your resources (see post, “personal inventory”). The very next thing you’d need to do is figure out where you are… and where you wanna go. Helpful tools at this point are a map and a compass.

Utilizing visible reference points, you need to establish your current location. Not where you wish you were… or even where you desperately need to be. Your current location is not where you will ultimately be – given motivation, persistence and some help along the way. But it is the place you begin. You cannot begin your entrepreneurial journey, from any other place than from the place you actually ARE. IF you had money, IF you had a partner, IF you had certain skills, IF things were neatly arranged differently in your life… THEN you would be in a better place to begin. However, IF you wait for such thing, THEN, most likely, you will never begin. As the proverb says, “a journey of a thousand miles, begins with a single step”.

What’s are the best first steps to take? Where is the best initial destination to head to? At this point (after establishing your initial location – metaphorically speaking) you are best served by paying close attention to your compass. The terrain may be too mountainous, the ultimate destination too obscure, the path ahead too undefined to get a ready fix on a clearly seen objective with sure, straight route to it. NO, wilderness trekking is rarely quite that easy. The unbeaten path of each individuals unique entrepreneurial adventure, is after-all, unbeaten.

No, you must set your compass to your own “true north” and follow it to the best of your ability, with all your heart; tenaciously, defiantly, sometimes insanely. No half measures will do. Be warned, the route is circuitous and thorny. The entrepreneurial journey is, before everything else, a journey of the heart. Your “true north” is anchored in your “essential” identity. Who you are intrinsically. What makes you tick. What you aspire to be and do and why. It is your “spiritual” core, your truest self. Your internal guru or sensei. Your best guess, an intuition of the most right way, your “gut” feeling. Learn to trust it. Learn to depend upon it. Try not to betray it.

Other peoples “magnetic” personality will sometimes cause your own compass to flutter. Particularly when you face tough decisions and you feel insecure. Of course, getting feedback and (small doses of) advise is wise. Ultimately, you must refer back to your own “identity” compass, though your path may diverge from theirs. Be true to your compass. Be faithful to your own unique path. Trust yourself to the process. This is the very best way to begin.

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Imagination: one of the most important tools that an entrepreneur can possess

Posted in E Essentials by Robert Lindsay Thompson on December 30, 2010

Imagination is more important than knowledge

Imagination is one of the most important tools /talents that an entrepreneur can possess.  Imagination is the ability to see realities that may not exist (yet).  It is said that “faith is the substance of things hoped for, the evidence of things not seen”.  Without imagination, the entrepreneur is blind to opportunities and possibilities.  Jesus commended the “faith of a child”.  Indeed, as children, most of us spent many hours in private revelry and make believe.  We must cultivate the capacity to dream, expand our ability to envision things beyond what presently exists.  One method is PLAY.

Your task is to recall one of your favorite childhood games and reenact it.  Yes, go ahead and be silly.  I give you permission.  In fact, it is a requirement.  Again, to quote one of my favorite world changers, “unless you have the faith of a child, you will not enter /see the kingdom of heaven”.  Without imagination, you may not get very far along your entrepreneur journey.

 

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