3 Things Every Business Owner Should Know

3 Things Every Business Owner Should Know

As a small business owner, I've learned a lot over the years. Some of the best things I've learnt have been through the mistakes I've made along the way. I don't feel (too) bad that I've made mistakes. I just don't want to repeat them. Looking back, a lot of it was pretty obvious, but when you find yourself running a business in your 20's, some of it is not obvious. I'm now in my 30's and still making mistakes, just not as frequently as I used to.

To be clear, this is some of the advice I wish I could go back and tell my younger self. Your mileage may vary.

1. There's Nothing Wrong With Being Small

When you've been going it alone for a while, and you finally start turning a profit, there's a temptation to hire staff and find an office so you can finally be a "real business". It's the natural progression. You get an office and hire some people, but it's not enough. You start thinking perhaps you need X number of staff and a bigger, fancier office to be classed as a "successful business".

The more staff you have, the more impressive your company sounds. That's how most people on the outside view it.

I fell into this trap. To be successful, I needed to grow my business, get a bigger office, hire more people. And why not? We had the turnover to do it, so I did. It also just seemed to happen organically. One day I looked up, and I was responsible for ten full-time employees, a whole host of freelancers, and an office big enough for 30+ people. Unchecked, a business can take on a life of its own. I didn't plan for it to be like this. It just kind of happened.

The more staff you have, the more politics there are. You go to the pub, and suddenly you can no longer fit around a table. Splinter groups start to emerge. You get a bigger office, and the overheads suddenly balloon. All of this leads to more stress and more pressure. Maybe some people get a kick out of it. I've found running a smaller, more intimate company is much more enjoyable. I'm not saying don't hire people or don't get an office. I'm just saying think before you do.

I don't want to end up running a business that kills me. I love my business now more than ever. I want to continue running a profitable business that provides well for its employees and is a fun and relaxed place to work. You need to be ambitious, but not so much that it makes you sick. Burnout is for losers.

My business is just as profitable now as it was when it was bigger. Being small has many advantages. Just because a company is bigger, it doesn't mean it can ship products more regularly. If anything, there's a tipping point, and things become slower. A side effect of growth is more process and more meetings. Small, agile and profitable is good, and dare I say it, a better place to be.

Think carefully before hiring anyone full-time. Think very carefully before getting an office. Think about the longer term and where things are going. Do you want the overheads and all the other stuff that a bigger business brings along with it? Sadly you probably won't fully appreciate how hard it is or what that entails until you've been there and done it yourself.

2. Build Complementary Products

This might be business school 101, but I didn't study business like many business owners, so I have had to learn the hard way. In most cases, you should build products (or apps) that complement each other, products that target your existing customer base.

It's much easier to pitch a new product to a market you already know. It's easy to think you should diversify, but you split your attention and focus by diversifying. It's risky and doesn't often pay off.

A photography app and a to-do app are aimed at different markets with little overlap. An incredible overhead comes with developing products in various categories that don't compliment each other. For example, the two apps share very little common code, design, and customer base.

However, if you were developing a to-do app and a calendar app, there would be plenty you could share between the two products. Having similar products allows you to iterate faster, ship more often and serve your existing customers better. Focus on a niche and try to own it.

My company is still guilty of having different product lines that don't benefit the same customer. So I'm slowly changing things, so our products fall into one major category. This change will take some time, it's not going to happen overnight, but we'll get there. I wish I'd figured it out earlier.

MacPhun is a perfect example of a company taking the extreme of the complementary product concept. They build photography software. If you need to do something with a photo, one of their apps will probably do it.

3. Employees Will Leave. Don't Panic!

It was all very new and exciting when I first started hiring people. The company was finally growing after many years of just me working alone. I was looking forward to getting more people on board to do more and build better products.

I certainly wasn't qualified to interview and hire people, but when you run a company by yourself, it's down to you to hire people. So in the first few years of hiring people, I honestly never once thought that these people might one day leave. It just never crossed my mind.

The first few people I hired were in a somewhat haphazard fashion. An informal interview, a drink down the pub, and that was it. Welcome aboard! A lot of the time, I just went with my gut instinct. Thankfully it all worked out. I've been very fortunate to have had a succession of great people to help build my business into what it is today.

Fast forward a few years, and the company had grown to around six full-time employees. Things were going well, or so I thought. Then one day, one of my staff said to me, "can we have a quick chat?". Not thinking much of it, I said, "Sure, what's up?"

He then told me he was leaving and handed me a resignation letter.

I was calm as I listened to his reasons why, but man, it was painful. When you've built a small company, it feels like you're just a bunch of friends making some products. It's all very personal. Later that evening, I remember thinking, "Oh crap, how am I ever going to replace him? What the hell am I going to do now!".

It was swiftly followed by me asking myself, "why would he want to leave? what if other people leave?" needless to say, this was all rather unsettling.

I got over it. You have to. The business adapted and changed, and things worked out. When someone decides to leave a company, it's a waste of time convincing them to stay. They've made up their mind, and if they stay, they'll end up unhappy and resent you and the business.

Sometimes when people leave, they just don't want anything to do with you, and that's sad. Perhaps it's a bit like when lovers break up. I don't know. I stay in contact with him and a few others who have left, and I like that.

When someone leaves a business, it's a great time to evaluate things and look at the bigger picture. Don't automatically rush to hire a replacement. Perhaps the company has changed over time, and you'd like to move things in a slightly different direction. Try to make the best out of what can be stressful within any small business and use it to your advantage.

It's Okay to Make Mistakes

As a small business owner, I've learned a lot over the years. However, some of the best things I've learned have been through the mistakes I've made.

I don't feel (too) bad that I've made mistakes. I just don't want to repeat them.

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