I’ve put together a venture capital dictionary of the most important venture capital terms you need to know on your journey as an entrepreneur.
Accelerator: A group, institution or program which offers guidance, networking, and infrastructure to companies in order to accelerate their growth. In return, the accelerator is given equity.
Accredited Investor: In certain markets and situations an investor must satisfy strict guidelines in order to be considered “accredited”. In the US, for example, an individual or group of investors must meet thresholds for net worth or income, as outlined in the 1940 Investment Company Act.
Acquisition: When a buying company purchases a controlling stake in a target business. When the board, shareholders, and managers of the target company approve of this deal, it is called a friendly acquisition. When one or more of these groups does not, it is called a hostile takeover.
Allotment: The process of providing new shares to shareholders. A shareholder’s allotment is the number of shares they are to be given.
Analyst: Part of a venture capital firm. Usually asked to carry out a preliminary analysis of businesses before a firm offers investment. This can involve projection analysis, early stress testing, market research, and other administrative duties.
Angel Investor: An individual investor who provides financing during a company’s earliest moments. This investment is usually offered in return for equity or convertible debt and is provided in order to get a company into shape for the next financing round (usually a seed round).
Anti-Dilution Provisions: An agreement protecting an existing investor’s share in a business. If new investors are brought in and given equity, the original investor’s equity is not diluted. They continue to own the same share of the business as originally agreed.
Articles of Association: A critical document that outlines the rights and restrictions attached to a company, as well as the said company’s share classes and share structure. This includes information about shareholder voting and selling rights.
Assets Under Management: This includes all financial assets managed by a venture capital fund.
Associate: A member of a venture capital firm. A step up from analysts, associates carry out more in-depth research and carry out due diligence.
B2B: Short for Business to Business. Simply refers to any company which does business with other businesses as their primary focus.
Bad Leaver: This happens when an employee or staff member leaves a company and violates agreed procedures. When this occurs, the “bad leaver” disqualifies themselves from share or equity payouts. In extreme circumstances, they are not allowed to hold onto their existing shares or receive money for them. An example of a bad leaver would be an employee fired for gross misconduct or someone who resigns before an agreed date of departure.
Board of Advisors: A group of individuals who offer advice to the management of a company. This is an informal relationship and not legally binding, but can provide valuable strategic policies.
Board of Directors: Custodians of a company. The board of directors (“board” for short) looks after a company’s affairs and makes major decisions about its future. To have a seat on board usually requires investment. For that reason, most boards are made up of investors or investor representatives.
Bootstrapped: A business, usually a startup, which is funded purely by the main entrepreneur behind the business and/or any generated revenue.
Bonds: A form of debt investment. In this case an investor offers a loan to a business in return for bonds equalling that value. These can then be cashed in after an agreed amount of time, and at a specified rate of interest. Bond owners are therefore creditors rather than shareholders and have no say over a company’s strategies.
Bridge Loan: A loan that bridges a financial gap. Usually used to finance a business when it is in negotiations with a large investor, to keep the business running until new investment or revenue is generated.
Business Plan: A business plan is a systematic breakdown of how a business will develop. This clearly states any expenses needed to achieve specific goals within a given timeframe.
Burn Rate: This is one of the least underlooked items in this venture capital dictionary but also super important. This is, in essence, the amount of money a company is using over a specified time. For example, a monthly burn rate. Used by venture capitalists to gauge how sustainable a target company’s expenditure is.
Buyout: A way for an investor or founder to exit a business. It occurs when another investor offers to” buyout” another investor or founder’s shares to gain more control of a business.
Cap: A limit placed on any transaction, usually financial. This could be a cap on fundraising or expenditure. It could also be a cap on the price of shares or a cap on the number of products being manufactured.
Capital: This refers to monetary assets that a company, group, or individual has access to for business use. You might also hear the term “working capital” to describe this, though that is most usually applied to available cash.
Capitalization Table: A summary list for a startup. Includes investor and shareholder details such as their names, percentage of ownership, and any shares or stock class they own.
Capital Gains: Any profit made from the sale of property or an investment. Usually taxed by governments.
Carried Interest (Carry): A fee often charged by venture capital firm managers. Usually 20% of any generated profits. This incentivizes managers of venture capital funds to ensure that they are investing their clients’ money in profitable businesses. This 20% fee usually only happens if an investment performs beyond an agreed threshold.
Cash-on-Cash Return: How much an investment generates in relation to the original amount. For example, if an investor invests $10,000 in a business which is then later bought and they receive $100,000 in return – that is a cash-on-cash return of 1000%. Also known as Multiple on Invested Capital (MOIC).
CEO: A chief executive officer. Responsible for all managerial decisions, and ultimately in charge of the business unless removed by a board of directors.
Compliance: A company is in compliance when they follow all regulations and laws which are salient and binding.
Common Stock: when you are thinking about venture capital terms this, in essence, represents company ownership. Shares allow their owners to vote on corporate policy and to have a say on serving directors. If liquidation should occur, or a sale, common stock owners are only paid an amount after bond and preferred stockholders.
Completion Schedule: An agreed timeframe for completing all administrative and procedural tasks in order to sign off on investment.
Convertible Note: as shared in my book The Art of Startup Fundraising, this is a legally binding agreement that if an investor loans an agreed amount of money to a business, that it can be converted into equity at a later date. For example, an investor lends $50,000 to a business with an annual interest rate of 10%. After one year, the business performs a share issue, giving that investor shares equal to $55,000. That’s the original amount, plus the 10% accrued interest as equity.
Convertible Preferred Shares: An agreement where shareholders can convert their preferred shares into common shares. This usually has a specific time frame associated with it, such as two years after investment.
Corporate structure: A description of how each department (Marketing, Human Resource, Accounting etc.) within a business contributes to the overall vision and goals of the organization.
Covenant: A legally binding agreement. This agreement stops an individual from carrying out a specific act. For example, an investor could agree to invest in a company if the startup founder signs a restrictive covenant. This type of covenant means that if the founder sells its ownership in the future, they cannot set up a new company that competes with the original business.
Credit: Finances given or “loaned” to a business or individual, usually with a date of repayment set in stone. The credit becomes a debt and often has a percentage of interest placed on top of the original credit agreement or loan.
Creditor: Individual, group or organization that lends money to a business. The creditor is who the loan repayments should be made to.
Crowdsourcing: Innovative, hassle-free way to seek investment by using third-party companies such as Onevest to match your start-up with ideal investors.
Crowdfunding: When investors or interested parties pool their money together to support a financial venture. Rather than having one large investor buy a large stake in a company for $1million, 10,000 people could each invest $100 each. This stops any single group from controlling everything and is in some cases easy to secure than one large investment sum.
Cumulative Dividends: A payment made to shareholders for an agreed amount. This is either fixed or an agreed percentage of a share’s price. Cumulative dividends must be paid out to shareholders with preferred shares if the original share purchase came with that agreement.
Debt: Any finances or assets owed to a creditor.
Debtor: A business that owes a debt.
Default: Failing to make debt payments.
Demand Registration: Also known as Demand Registration Rights. Where an investor can force a private company to initiate an IPO or share issue so that the investor can sell their shares on an exchange. Usually only applies to common stock.
Dilution: When an existing investor or founder’s share of a business is diluted. This happens when new investors buy up equity or shares and there is no anti-dilution agreement in place. This reduces the fraction owned by current investors/founders. This is a critical term in this venture capital dictionary.
Disruptor: Any innovation in a marketplace that disrupts the existing way of doing things. This can be through new technologies that leave existing ones obsolete, finding a new demographic for a niche, or altering the price point usually associated with an existing marketplace.
Dividends: Profits paid to shareholders. A dividend in kind is the payment of assets instead of cash.
Down Round: If new investors buy shares at a value lower than a previous fundraising round or share-issue, then this is called a Down Round.
Drag-Along Rights: Force’s minority shareholders to back the sale of a company. Usually forced through by shareholders holding anywhere from 50% to 75% of the stock.
Due Diligence: A complete financial and legal assessment of a business or deal before purchase. Only through due diligence can a buyer know exactly what they are buying and its robustness.
Dynamic Equity Split: Co-founders or investors are rewarded new shares in their business dependent on their performance. The more someone contributes, the more they earn.
Enterprise: A company or business.
Entrepreneur: Someone who starts a business.
Entrepreneur in Residence: A successful entrepreneur who is hired by a venture capital firm to identify future investment opportunities. They may offer mentorship to the firm’s portfolio of companies.
Equity: A portion of a company. Someone who owns equity owns a percentage of a business through shares or an agreement to be given shares at a later date.
Exit: The end-goal for most investors. How an investor sells their share of a business, hopefully for as high a profit as possible.
Fair Market Value (FMV): After analyzing a business, this is the amount an independent third party assessor believes a company’s shares are worth. When you are thinking about the venture capital dictionary or terms this one really comes into play when doing a 409A Valuation.
Financial Forecast: Also known as a financial projection, a forecast estimates growth and income for a business over a given time, based on comparison with existing businesses and market research.
Founder: The person or people responsible for the creation of a company.
Funds of Funds (FoF): A fund that invests in other funds. Imagine a venture capital group that invests in other venture capital groups.
Future Proof: Projecting into the future and protecting a business or product so that its fundamental design will keep it competitive in the future.
Ground Floor: When an investor has the opportunity to be part of a company from its first, initial moments.
Harvest Period: This is the period where a venture capital firm starts to generate returns on its investments. Usually results from an IPO, merger, acquisition, or new product launch.
Incubator: Similar to an accelerator. An organization that offers assistance to startups so that they may reach their initial investment rounds.
Initial Public Offering (IPO): The first sale of shares traded openly on a public exchange.
Internal Rate of Return (IRR): As part of this venture capital dictionary this is a calculation of how much money is returned on investment annually. Venture capital firms expect to see larger returns over longer periods, and so if an investment’s IRR diminishes over time, VCs may sell their shares in order to free up investment for more lucrative ventures.
Investment Period: The time taken for a venture capital firm to invest its funds across its portfolio companies. Most venture capital funds have invested all their capital after 3 – 5 years.
J-Curve: When the IRR (See Internal Rate of Return) of a venture capital fund is plotted on a graph, it should resemble a J as profits grow.
Kamikaze Defense: A last-ditch defense against a hostile takeover where a company carries out strategies to reduce its operational or financial worth. The end result is that this may make a business less attractive to investors.
Limited Partner (LP): An individual or entity such as a pension fund or insurance company which contributes capital to a venture fund.
Liquidation: When a company is dissolved and its assets are disposed of or sold.
Liquidation Preference: A clause in a contract which stipulates which investors receive payment first if a company is liquidated or sold, even before a company’s founders in many cases. This is a common clause often used by venture capitalists to off-set the risk of investment.
Liquidity Event: Any event which results in liquidation, such as defaulting on debts.
Market Research: A way to define consumer wants and needs. By carrying out market research studies, a start-up can then streamline its approach to be more appealing to a target demographic.
Market Value: The amount an investor or consumer is willing to pay for something based on current consensus about how much a company, product or service is actually worth.
Mezzanine Level: Companies which are beyond the startup phase, but not fully mature. Even though this is included in this venture capital dictionary this tends to be for more later-stage companies.
Non-Disclosure Agreement (NDA): An agreement that anything mentioned between two parties cannot be disclosed with others. This includes product information and other sensitive data. For example, if a VC firm carries out due diligence into a target company, they may have to sign an NDA so that, even if they do not make a purchase, they cannot use the information they discovered during this process. Keep in mind that even though this is included in this venture capital dictionary, VC firms hate to be presented with NDAs right away for just intro meetings.
Outsourcing: Hiring a freelancer to complete a task for your business rather than you or your employees doing it. A Common practice to reduce overheads and secure quality work without requiring full-time staff.
Option: Similar to right of first refusal.
Pari Passu: Term used during negotiations. It means side by side or at the same rate.
Pivot: A quick change in business strategy. Often occurs when a startup shifts its attention to a new niche or product type.
Portfolio Company: A company in which a venture capital firm has invested, adding it to their portfolio.
Preferred Stock or Share: This type of stock is rewarded with dividends before common stock.
Proof of Concept: Demonstrates that a product or service will work and be financially rewarding for investors. Most venture capitalists will expect this before investing.
Prospect: Sales speak for any customer or investor who fits a demographic. A person who is most likely to make an investment when approached. Also known as a potential investor.
Pro-Rata Rights: Provides an existing VC investor with the option to increase his or her stake in a company during future fundraising stages.
Qualified IPO (Qualified Public Offering): A description of a future IPO of a company. When used, convertible equity securities convert into common equity. Also used to terminate stock transfer rights for specific investors if necessary.
Recapitalization: When a company restructures its capital, changing its equity and debt ratio.
Right of First Refusal: A contractual agreement that an investor will have the first option to buy shares or take part in another business transaction before being opened up to others. As part of this venture capital dictionary, this is an important term when you have a large corporation that wants to invest in your company as that could limit your potential outcome eliminating the possibility of a bidding war.
Return on Investment (ROI): The amount of profit an investor makes in relation to their original investment.
Seed Round: The first financing round for a startup. Often attracts angel investors. Precedes series or “round” A.
Secondary Public Offering: Takes place after an IPO. A share offering to the public, often when founders are looking to sell their stake.
Sector: A market niche where a business is looking to sell its products or services.
Series: A round of investment. Usually named A, B, C, and so forth.
Stage: The level of development of a startup.
Startup: A business at the beginning of its journey, usually the first couple of years.
Syndicate: A network of investors looking to invest during a specific fundraising round.
Tag-Along Right: A legally binding agreement that ensures minority shareholders have the right to sell their shares for the same value or terms as majority shareholders.
Term Sheet: Outlines the main points of investment, how it will be paid, what will be given in return, and what the investment will be used to achieve. Not legally binding, but provides a good foundation during negotiations.
Underwriter: An individual or firm who “underwrites” or assumes the financial risk for another party.
Valuation: When assessors, usually a third-party, calculate the value of a business through its assets, finances, revenue, burn-rate, and future projections.
Venture Capital: Pooled finances of a venture capital group currently available for investment.
Venture Capitalist: Individual, usually in tandem with a venture capital firm, who invests in companies, often within a specific niche.
Venture Partner: An individual brought in temporarily to assist a venture capital firm. Not a full partner, but may identify and facilitate new investment opportunities for a VC firm.
Vesting: Stock options provided to employees, usually as a reward for performance and duration of employment.
Warrants: A contract issued by a company allowing an investor to subscribe for shares at an agreed price during an agreed time frame.
Window: Time frame associated with a share option or investment opportunity. This term is super important in this venture capital dictionary as founders need to continue to create urgency or the fear of missing out.
XRT: An extension that appears after a ticker symbol on a listed stock. It means that the buyer of the stock cannot legally buy shares at a lower price because the rights to do so have now expired.
Yellow Knight: A company, investor, or VC firm that was going to carry out a hostile takeover but pulls out, offering a friendly merger instead.
Yield: Financial or asset measurement. Usually, the amount or percentage returned to an investor for their investment. Includes share sales and dividends. The earnings an investment generates over a specific period of time. For example, one quarter or annual yield. Even though this term is included in this venture capital dictionary this is not a typical term that early-stage companies would encounter.
Zone of Resistance: The upper limit for a share’s potential value. The lower limit is the Zone of Support. Understanding the zone between helps venture capitalists and other investors gauge a good time to buy or sell the stock.
Why Dropshipping won’t last
Over the past few years, the "Shopify+ Aliexpress + Facebook ads + Instagram Influencers + courses = dropshipping" model has really curated an entire wave for anyone to make a substantial amount of money, for absolutely low risk, low overhead, and low cost. This is an absolute dream, and it's one that has rapidly became one of the fastest-growing methods for becoming wealthy. However, this method and the common tools used today are soon going to die off. People say that dropshipping is dead. Well, it's not actually; far from dead, it's completely oversaturated. That oversaturation will be the downfall of the model and practice itself leading towards its disinterest for entrepreneurs.
What most people forget about is that consumers like low prices, abundant of options, fast delivery, and great customer service/experience. Most of which, dropshipping stores are terrible in providing. This is why bigger distribution giants like Amazon, Walmart, and eBay will be stronger long term because they have mastered these models for years. If a customer is willing to purchase a product from your store, then it's invested in the value of the product and timing itself. Most people go as far as creating brands around their stores, but even that can be challenging long term if you aren't focused on it, or you don't have the audience that further support you from another source.
Where most people make their money from dropshipping is from having that "first-mover advantage". This makes sense as being the first to any new market cements your business in a new customer base where you are going to be the most profitable. This goes for any industry where money is to be made. The issue occurs as time wails on, the barrier of entry to be profitable becomes more challenging with requiring more resources. We already see it with the facebook ads becoming more expensive now per impression, than they were 3-4 years ago. Now mostly anyone who operates in the dropshipping space today is only focused on the one thing: selling courses.
Selling a course to further education on any topic is one of the most profitable business models, especially those that bank on the distorted lifestyle that you are guaranteeing to the customers. Let's be real, most of the courses sold are driven by selling you on a dream. Sure, there might be some value gain that better enhances your skillset, but the fact of the matter is you proceed into these guru courses with selfish intentions of making money for YOU which is an absolute dangerous mindset to have. No one cares if you make money. If they do care, it's more of the fact they want to take notes so that they can replicate the same progress, extract some kind of benefit from you, or out of sheer curiosity. IN business you should focus on what you are providing to the customer and the world for the longevity of the business. If you are seeking to solve a problem, no matter how big or small, there is value in it all.
Lastly, I know what some people are thinking, if dropshipping is dying, then what is the next BIG money maker? You honestly would not know until you do that thing to see how it resonated with the world. I know most people here are into software engineering and hope their app that they built would be on the list as the FAANG, which if it goes to that level, congrats; if not, then I'm sorry. But as we see, the more people who flood into an industry specifically for the focus of money creates a dirty bath of people who just absolutely suck and won't make much money from that. All because they were sold on this process, especially if it's one so common everyone is using it. From there, it adds no additional value whatsoever. So get out and create/build something that's actually worth sending you my bitcoin lol.
The exceptional video that explains more
How an ex-Googler got 6K+ subscribers in 4 months by teaching neuroscience to entrepreneurs
Hey, Daniel from Hustld.com bringing you another interview
Today's interview is with Anne-Laure Le Cunff from Ness Labs.
Service: Mindful productivity school that teaches neuroscience
Founded: April, 2017
Hi Anne-Laure! Tell us about yourself and Ness Labs.
Thanks for having me! I’m an ex-Googler turned entrepreneur. After working on several digital health products at Google, I left to build products helping people live healthier and happier lives. I’m also studying neuroscience part-time at King’s College. Ness Labs is a mindful productivity school. We teach entrepreneurs how to apply neuroscience principles so they can achieve more while taking care of their mental health. It’s all about beating procrastination without beating yourself up. I use my experience as an entrepreneur as well as what I study at university to craft content and products bridging the gap between neuroscience and entrepreneurship. Some of our products include Teeny Breaks, a Chrome extension reminding people to take mindful breaks, and Maker Mind, a weekly newsletter about mindful productivity with more than 6,000 subscribers. We also have a library of content around mindful productivity, a shop, and we’re about to launch our first course.
How did you come up with this focus on mindful productivity?
Both at Google and when running my company, I have experienced burnout. It’s pretty hard at first to see the signs. It’s a constant oscillation between exhaustion and exhilaration. We tell ourselves to push through, that we’ll be able to rest after the next deadline, that we just need to make one more effort to get it done. In the end, both our mental health and our productivity suffer. We’re unhappy, and we don’t do our best work. Burnout and mental health in general are still pretty taboo among entrepreneurs, and I want to use what I learn at university as well as my own experience to tackle these topics, and help people not go through the same experience. What I like about Ness Labs is that it’s akin to a sandbox where we can experiment with new products and see which ones are the most helpful.
Interesting. How do you go about launching these new products?
I’m a big proponent of working in public, so I tweet about the creation process. I ask for feedback and get my audience involved very early on. Once I have a first version, I launch on Product Hunt. It’s not necessarily what everyone should do, but it happens that my audience hangouts there too. I also post all of my articles on Hacker News, which can be an important source of traffic if a link hits the front page. I don’t believe in launching once. I constantly re-launch new versions, update things as I go, and iterate to improve on the products.
What has worked so far to attract customers?
Writing content on the blog has so far been the most effective way to grow the audience and thus attract customers. All of the consulting opportunities, the newsletter sponsors, partnerships, the workshops… all of these were inbound. I never did any cold emailing. People read the articles, they reach out using the contact form asking how they can work with Ness Labs. It’s great because you can’t imagine having a more qualified prospect than the one who proactively reaches out to your company.
Describe a moment where you had to overcome a challenge.
The challenge with relying so much on social media as a marketing platform is that it’s very unpredictable. Sometimes a piece of content goes viral, sometimes it brings very few visitors to the website. I still haven’t figured out the magic recipe, so the only strategy I rely on is consistency. If you publish content on a regular basis and make sure to share it, you’re bound to grow your audience.
What tools do you use for your business?
The website is WordPress hosted at DreamHost. I recently switched to them and their customer support is amazing. For the newsletter, I use MailChimp, but I’m exploring alternatives such as ConvertKit. We all work together using the Google suite, it makes it easier to collaborate and that’s what I’m used to. I personally hate Slack, so communication happens via Gmail and Hangouts. For payments, Stripe and Gumroad. I also use VS Code for coding and Adobe Creative Cloud for illustrations and design.
Do you have any advice for other entrepreneurs who are just starting out?
Stop hiding behind your products and put yourself out there! Start a blog or a newsletter and share your creation process. This is an incredible way to learn, grow as a person, and make new connections.
Thanks! Where can we go to learn more about your company?
If you'd like to read more interviews visit hustld.com
Why a boring full-time job is… great for entrepreneurs (rant)
A rant I had to share.
In 2019 it has become “cool” to say: “a nine to five job sucks, I am going to start my own business instead”. “Corporate jobs kill creativity”, “starting a business is easier than ever before” and “you can make millions in passive income”. While some of the above is true, it’s about time someone posted a rebuttal to a now common notion that a full-time office job sucks.
Here is an entrepreneur’s rant for “wannabe-entrepreneurs” and younger generations who are about to finish school/college and who are at the crossroads.
Because starting a full-time job is often the best decision you can make if you want to be a founder. (This is just part of the rant, you can read the full rant here).
You have probably heard by now that you need to offer some sort of value to your potential customer, for them to buy any product or service from you. Well, what kind of value could you offer if you have no experience doing anything even mediocre? Do you think you have really tried it all in the job market, just because you worked for 6 months at a coffee shop?
Stop and think again.
Of course you can start your own lawn mowing business. Of course you can deliver newspapers and try scale it up. But, guess what? So can virtually anyone else. The easier it is to do something, the more competition there is in the market. The more competition – the more you will have to slice your prices to attract new clients. If you have experience in a field that is more complicated, requires more thought process and is technically challenging, you would have obtained that unique value that you can offer to your customers.
No money – no food. No food – you die. Simple. You hear and read stories about someone starting their own business, struggling for a bit, and then they make it. Guess what, that “bit” is the make or break period. And if you don’t have enough savings, and you can’t rely on your mommy or your daddy to give you lunch money, you will need to have a full-time job to feed yourself during that time. In many interviews, founders of larger or smaller businesses always skip through this part, and yet it is absolutely crucial.
They might say: “we went through some hard times, but then in October of 2017, we had our first big order”. Do you know how many people give up on their dream, before that first order that makes the business survive? No one knows, because we don’t like to talk about our losses, so this data is not recorded anywhere.
Yes, you can take a loan. Yes, you can use that loan to “stimulate” yourself to achieve an x goal. However, if you have a full-time job, this gives you so many more options:
If you don’t care too much about earning money straight away from your startup you can experiment. This (hopefully) means that you won’t sacrifice quality for cash at the pivotal moment, and so you and your company will win from this crucial decision long-term. You won’t become depressed, simply because you haven’t had any traction for two months. Ideas that seemed genius at the start fail every day. Big deal. With a full-time job, it won’t cost you your house or your family’s well-being. And that’s priceless.
If it doesn’t work out, you have a plan B. Don’t get me wrong, sometimes that “fear of death” drives us to do the most remarkable things. In adversity, human mind works wonders. J.K. Rowling was a single mother, who was raising her kid in poverty when she wrote “Harry Potter”. Would she have been as inspired if she had a loving boyfriend, no baby to take care of, and rich parents? Who knows. However, not every writer is J.K. Rowling, and more importantly – we all fail. And sometimes a plan B – a.k.a. a full-time job – is what we need to fall back on, in order to get back up. You can save money to start a new business. This is perhaps the biggest selling point of a nine to five job. Saving enough money means that you could enter a harder market – i.e. a market that would require you to spend more than an average founder. But, this could also mean higher returns.
One of the top tips for any entrepreneurs is always to find a mentor. If you go into finance, you should find someone who has been making money for the past 30-40 years, to learn their formula for success. If you start a pet toy shop, you need to find someone who ran a small shop previously, and either sold it at high valuation or who is still successfully running it ten years later. We all look for blueprints to follow, consciously and subconsciously. We want to hear success stories.
What better success story than your boss?? That’s right, your boss. The man or woman whom you have viewed as the necessary evil up until now. Ideally, your boss is someone who has their own business and who has been running it for some time now. If they have a business, and they could afford to hire you, surely they must be doing something right?
Here are the things you probably never thought of before, but that you could learn from your boss, no matter how much of an ********* (enter any swear word of your choosing here) they are:
How to maximise profits and minimise expenses.
How to find and learn from clients.
How to start a business and not run it into the ground after two months. (Has it ever occurred to you to ask them how they got started?).
How to hire the right people.
How to stay lean. Believe me, no one more frugal out there than a successful small business owner.
How to optimise your businesses for taxes.
In some cases, how to scale your business.
And last, but not least – you can also learn from their mistakes. Are they being horrible to their employees and so the latter keep quitting? Are they not listening and it’s costing their business? Good, you won’t make the same mistakes when you run your own business/
Your boss could be your best mentor. You don’t have to like them. They don’t have to like you. But their knowledge could be invaluable.
Thank you for your time and go get to work now.
I already mentioned this, but by now you probably forgot about it – the full rant was published originally here.
EDIT: The formatting looked a bit weird towards the end, fixed some of the spaces.
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