[Excerpted from an interview with Debbie King published by Authority Magazine.]
Sometimes experience is our best teacher. Other times we just need to hear the right message at the right time. Authority Magazine recently interviewed me about 5 things I wish I’d known as a business owner. Perhaps one of them will be exactly what you need to hear right now:
1. Mindset is the foundation for everything.
Here’s what they don’t tell you in business school: The quality of our relationship with our business is responsible for how profitable the business is and how much time we spend in it. All relationships consist of thoughts and feelings and it’s the same with your business. It reflects back what you put into it. Are you putting in stress, frustration, and blame? If so, you’ll likely get negative results because how you feel determines what you do.
Learn to generate feelings that drive productive action because that’s the way to achieve your goals. Notice when you have negative feelings like frustration because you can use them as a trigger to ask the question, “Will this state of mind lead to the result that I want?”
2. Run your business like you plan to sell it. Even if you don’t plan to.
This is a great brain hack because when you start thinking about selling your business, you’ll start acting like an investor. One trap I fell into was running my business like a lifestyle company instead of an asset.
Don’t get me wrong; I loved the expensive company car, the exclusive business clubs, and the upgraded hotel suites. But by not reinvesting in my business, I was missing the opportunity to build an asset that would ultimately take care of me financially forever – one that would leave me feeling energized, fulfilled, and truly free. Once I realized this, I was able to course correct, by filtering every business decision through the question, “Will this increase the value of my company?”
3. Don’t trade time for money.
Imagine individually creating a brand new, high-production film like Star Wars for every person who wants to see a movie. You’d never do it because it wouldn’t scale. Yet this is exactly what so many of us do when we own a service-based business.
My advice is to constrain and simplify. Identify what 80% of your customers need and build a solution that does that because that’s how you can scale. A solution is like the product for a services business. Bonus points if you can bill monthly in advance and generate recurring revenue. Ask yourself how you can automate and systematize your process, brand it, and market it like a product.
Can you package and provide some of your company’s expertise into online courses and subscriptions? Can you create a community or membership site with training videos and templates? Always be thinking of ways to simplify and systematize in order to scale.
When you do this, you offer all customers a ticket to the one film you already created — your solution. This solution (or product) solves the common problems for your niche and uses your unique process to do it.
4. Embrace the numbers.
Accounting and I got off on the wrong foot. I got a “B” in my freshman accounting class and, for a perfectionist like me, that was humiliating. I decided that I just wasn’t a numbers person — a mindset that came back to bite me and my first business at tax time. Looking back, though, I can see that I also avoided it due to other issues.
I wanted to think about the future, and accounting made me look at what happened in the past. For years I watched the top line (the amount of revenue we made) and the bottom line (the amount of profit). But I rarely looked at the categories in between. This lack of focus is part of what prevented me from growing my company faster.
You may think you’re so busy managing the day-to-day that, as long as you’re profitable, that’s all you need to know. But it’s not. What gets measured gets done. You can’t fix what you don’t see. Pick 5–7 Key Performance Indicators that measure your growth, marketing, customers, and efficiency. Then share them with your team. When everyone works together to achieve goals, it’s a force multiplier for success.
5. Don’t make it about you.
As business owners, it’s easy to connect our identity and self-concept to our business. We feel good about ourselves when the business is doing well and we feel inadequate when it’s struggling. This leads many of us to overmanage. I know it did for me. I tried to control everything because I thought that was the way to ensure the business would succeed and I could feel good.
But this strategy created a trap because it made my company dependent on me.
I learned this lesson the hard way one afternoon. I was riding my horse in the woods when he spooked and bucked me off. I broke my ankle badly and was in the hospital for 3 days for reconstructive surgery. While I was out, my business came to a standstill.
It’s kind of embarrassing because although we were generating yearly revenue of seven figures, I was still doing all the invoicing. No one else even had access to the books. Invoices didn’t go out that month, and we ran into cash flow issues the following month. Not only that but because I’d always made all the decisions, my team was hesitant to take action on other things like proposals and estimates.
So we also didn’t generate any new sales while I was out, which led to additional cash flow problems the following month. That was when I committed to taking the steps to turn my business into an asset that could run without me. So that never again were we dependent on any one person.
What do all five of these tips have in common?
They’re about your relationship with your business. And creating a loving relationship with your business is the fastest way to freedom.
Think about it — when you love something, you care about the relationship, you look for the good and show appreciation. Loving your business means feeling connected to yourself, your team, your clients, and your solutions.
It means you spend quality time with your business, you’re intimate with your numbers, and committed to personal and professional growth. You’re willing to be vulnerable and admit when you make a mistake.
Appreciate yourself for having the courage to build a business, and appreciate your team and customers for being on the journey with you. Love your business, and treat it as an asset, and it will work for you.