3 Lessons for Building Long-Lasting Successful Companies
Why do people think that making a satisfying and genuinely fulfilling life differs from building and growing a successful startup? It does not.
Life is hard. Everyone who’s been in this world for years knows that. For most of us, life is not hard because we have bad luck or wrong timing but because we do not commit correctly to our goals, especially when we talk about startups.
Of course, building a fast-growing company and making it a success is a lot of work and sacrifice. We don’t fully understand some basic principles; for example, the most common question I get asked is: “When is the right time to embrace your entrepreneurial career?”
You can start at any age, but you have much more chances to succeed if you roll your sleeves in your twenties than in your forties. Much better if you are a first-timer entrepreneur than a “serial” one. I know it’s counterintuitive, but follow me for a few minutes, and you’ll see why.
Becoming an Entrepreneur
Choosing to be a startup founder is not something you usually decide to do. It’s more something that hits you repeatedly until you start listening to it. Sooner or later, you understand you can’t work for other people. In my case, I was in my thirties—which is a bit late—and I embraced the entrepreneurial path after five years spent in corporate life, working for a Chicago-based international consulting firm.
I loved learning new things in my twenties, but my interests were very narrow. I was a college senior studying Computer Science in Milan, Italy, and software stuff was my only interest, hobby, and passion. It is worth saying that before getting into computer science, I wasn’t much of a reader. It was the early 90s, and my role model was Bill Gates, a workaholic nerd who co-founded Microsoft at 19 years old. He didn’t raise any VC capital and had to take his company public to allow his employees to sell their vested shares. I remember I read everything I could find about him, and because Amazon didn’t exist yet, finding technical and business books in English was always a challenge—but a good one. I still remember how happy I was when I could find “Microsoft Secrets” at Copenhagen airport or the third time I read “Gates”.
I learned the U.S. company culture and software development processes by reading books like those, and the hacker culture of working hard and learning from people better than me was my bread and butter.
Learning computer stuff and sharing it with other people was my goal. Then, I began to create companies, and I remember how scared and thrilled at the same time I was. Entrepreneurship didn't come naturally to me as I was not raised in an entrepreneurial family and risk-taking was not much part of my small town's culture.
Year after year, company after company, I understood that unlearning is the most challenging thing. That drove me to ask myself a simple question:
What rules do you need to follow to maximize your chances to create companies that not just succeed but can last over the decades?
In startup land, we always emphasize the importance of growing your business and doing it quickly. That is what attracts venture capitalists to finance your company. However, most startup founders are moved by other motivations than raising capital and selling the company for $1B. They want to build something unique and make it last forever.
TL;DR: Those three simple rules are what I keep perfecting after 25 years in this business.
# 1 - Act Like It’s Always Day One
It’s almost embarrassing how good you can become if you keep practicing and practicing over the years, and anyone who has read Outliers by Malcolm Gladwell knows that well. Becoming a good entrepreneur, though, is not like every other ability; a hidden threat exists in perfecting your skills when your job is building companies. No one tells you how dangerous it can be when you come to convince yourself that you are damn good and everything you do will become an instant success. Otherwise said: when you start thinking you made it, then it is when things begin to turn for the worse and you could lose all you’ve built.
When you create a company, you don’t know how hard it will be to take it to the next level year after year, and as an entrepreneur, nobody can scare you enough to stop you from pursuing that anyway.
The good news is there’s a way to win at this game in the long run: wake up every morning thinking it’s always day one of your journey, that everything you have built up to that moment is just temporary, and that improving and flourishing your creation requires your present commitment—plus, heart and sweat.
I’m not talking about being a workaholic; the point here is not to let other people, less passionate and—often—talented than you, take over what you built before you are completely sure they are the right ones. That doesn’t mean you don’t have to delegate. You do, but you must never let others drive without you being in the passenger seat—at least for the first thirty years.
That means you can’t really relax. If you are the company's founder, then 90% of the time it can’t reach its full potential without you. There are notable exceptions, like Cisco, but for the rest of us, the rule is simple: nurture the mindset that it’s always day one, and you’ll be good.
#2 - Remember Who You Are
And this takes me straight to lesson number two. Never let the goals you achieve define who you are as a person.
That’s hard because every time you win your ego grows!
A bunch of Ferraris in your garage doesn’t mean much. With success often comes money and, sometimes, financial independence or even wealth. Success is not wealth. Those things shouldn’t influence who you are, but when your life tenor changes and your habits follow in a few years, keeping being yourself is tough. Anyone who worked his ass off can be lucky once in life and make money. But building and growing a long-lasting company is something different. It takes all your focus and energy especially to stay true to yourself, your values, and the promises you have made over the years.
My point here is that you should stay humble and, as I said in a different article, cultivate humility instead of arrogance. Choose the path that keeps you closer to your customer base because that’s where you can learn directly from the source. Most of the time, financial reports don’t tell the whole truth.
Develop the attitude that’s always day one of your journey, and you’ll be fine.
#3 - Succeeding Once in Business Doesn’t Make You a Better Entrepreneur the Second Time
This may not be a universally shared opinion; nonetheless, there are multiple examples of this fact. People who crushed and burned on their second venture are definitely less known because they aren’t invited to give the commencement speech at Harvard. We love to celebrate the serial entrepreneur.
Many people—including myself—have made this mistake, and that’s why I believe that first-time founders have the best chance to create unique companies. Not only do they have nothing to lose, but they are not influenced by what they accomplished in past business ventures. They have less experience, but “experience” doesn’t save anyone from making old mistakes over and over.
As I said, unlearning is the hardest part. Rules #1 plus #2 could help, but internalizing them without experiencing failure and developing a healthy relationship with the fact you are not always correct can be challenging.
Have you ever noticed how much you learn from failure and how little you learn from success? Success makes us feel good, and we all want to succeed when we start a company. As Professor Robert Kunzman said during a TEDx speech:
Don’t be afraid of failure. Keep trying. Failure ultimately leads to success. Except when it doesn’t.
Success is not a direct consequence of previous successes, and neither is a mere achievement you will get once you have learned from failures. Reaching success in an enterprise is also not just a direct outcome of passion or persistence. Those qualities help you not to be discouraged by defeats along the way. Success is defined by many external factors and uncertainties we cannot control. In this sense, it’s not something you can repeat just because you already reach it in your life.
The sure reality is that failure is something, sooner or later, we all meet. Learning to cultivate a healthy relationship with failure and the role that it will play throughout our lives is much more valuable than having succeeded once or twice.
Unlearning from your previous wins takes a lot of work! In this sense, I prefer to bet on fresh young people who will learn while creating their first company, having given all they can to their venture. They are much more eager to listen to and learn from other people's experiences. The good ones are those who listen to you carefully and then use their mind to make a decision. The great ones are those who don’t identify who they are with their goals. For the latter, recovering from failures will be much easier; they keep going and sometimes create unique companies.
