Dave is a best-selling author and financial consultant. His ideas are simple in thought and harsh in reality, but that is why they are so good. Some examples are paying off the debt, if he doesn’t have the cash, don’t buy it and the most famous “the borrower is a slave to the lender”. EntreLeadership is a combination of Entrepreneurship and Leadership in action.
Why is this important to me?
I always want to ask this question like I’m sitting in your shoes. Will this summary benefit you if you review it? I’m a big fan of mash ups, which means combining concepts to achieve a “bigger/better” result. Successful mash ups include: Ray Charles – combination of Gospel and R&B, Kid Rock – combination of Rock & Roll, Country and Rap. Mash ups are very successful and that is why millions of people carry a combination of phone, computer, camera in a device called iPhone.
Entrepreneur is a term applied to a person who is willing to help launch a new business or venture and accepts full responsibility for the outcome.
Leadership has been described as the “process of social influence in which a person can enlist the help and support of others in carrying out a common task”.
EntreLeadership is packed with great information on building a business. This is Dave’s scrapbook of experiences and lessons. We can learn a lot from this book. Remember, it’s more important to leverage partnerships and learn from others to accelerate success. I will outline four concepts and give them a spin as it has helped me in my business.
1. Passionate Action: Passion is by far the most important energetic force in any business. Without passion, the business will die. The easiest way to put this in perspective is marriage. If there is no passion in the marriage or relationship, it will eventually die. Action is required to get things done. Action and execution is what separates the winners from the losers. George S. Patton said, “A good plan violently executed now is better than a perfect plan next week.”
2. Decisions: Decision making is a skill that must be mastered. Any decision is better than no decision. Many people get paralyzed when an important decision needs to be made. There are various skills in decision making, but here are a couple of things that will help:
1. Consider the worst case: If you can handle the worst case and the benefit outweighs the cost, do so.
2. Trust your gut: The red flags are there for a reason. I can tell you from personal experience that I didn’t go with my gut when buying a particular business. I knew the previous owner was a nightmare and I made the deal anyway. It was a big mistake. My gut told me no and my head got caught up in the perceived numbers. Not following your “informed intuition” equals bad decisions.
3. Decision Tree: People tend to think that decisions exist in a vacuum. This is not the case because one decision will only lead to the next decision. When you frame it this way, it becomes more manageable.
4. Outs – If you play poker, you will understand the power of leaving yourself outs. Having outs (or options) after the decision makes things much easier. In poker, if you decide to go all-in and need one card to win, that’s a bad call, but if you have 12 card options to win, it’s a good call. That’s the essence of having “outs.”
3. Sell: generating profitable income is the most important task of any business. Therefore, when you make the decision to start your business, you should do it part-time without giving up your job. The fastest way to build the business is to make sure that there is a market and that you can generate income. I have seen countless failures because people focus on putting the business, office and equipment together to begin with but forget about the customer part. This leads to bankruptcy. You can scale the infrastructure after you start generating profitable revenue. Until then, you must sell and trade to prove that the business is viable. One quick note, you can market test Google without spending any money on the product. This is a great way to show that people will buy your stuff and that you don’t have to shell out thousands of dollars in prototyping and production to do it. Do the market research first and then step up.
4. Money – “Borrowing is a slave to the lender” according to Dave and he’s absolutely right. When the tide comes in, you know exactly who’s naked because too much debt and spending kills businesses. In 2008, Lehman Brothers went bankrupt, Merrill Lynch was sold in a weekend, and Bear Stearns got a bailout. This all happened because the management was incompetent and had no idea how to manage the debt. Money hides mistakes. It should be a goal that every week you get out of your business owing no money. For the small business owner, this provides “exits” and flexibility to ride the waves of the market.
EntreLeadership is a good book that provides a working roadmap for a small business owner. One part of the book talks about adding people. This can be the scariest thing a business owner can do. Remember that if you hire people who are better qualified than you, then your business can go further than you thought. Good quality people with the right direction and leadership make great businesses.
I hope you found this short summary useful. The key to any new idea is to work it into your daily routine until it becomes a habit. Habits are formed in as little as 21 days. One thing you can take away from this book is ACTION. If you have an idea and need some extra money, put in the hours and start a business from home. Small businesses create 3 million new jobs a year. Get started now, but don’t quit your day job until your business can support your lifestyle.