10 Practices of Successful Entrepreneurs
By: Robert Heavrin
Tags: Startup, Success, Successful Entrepreneurs, Business, Entrepreneurship

10 Practices of Successful Entrepreneurs

Booty Caller. It was the way-too-crass working name of a mobile app idea a buddy and I had in 2008, the year the App Store launched. Booty Caller would use your phone’s GPS to connect you with potential nearby romantic partners. We made a logo, designed the app interface, and engaged a developer. But ultimately, cowering under a daunting cloud of uncertainty, fear of failure, and lack of know-how, we filed away the project into the coulda-woulda-shoulda folder. Four years later, while we wallowed in nine-to-five obscurity, Tinder revolutionized dating.

After a decade of working for corporate America, NPR’s How I Built This podcast, hosted by Guy Raz, has re-awoken my entrepreneurial vigor and armed me with an instruction manual and the courage to capitalize on the next great idea, should it ever come my way again.

Every episode is must-listen material, but below is a list of practices you’ll need to follow to become the next How I Built This founder.

1. Ball on a ramen budget

Let us first agree it won’t be easy or glamorous, especially in the early years.

During Chipotle’s first year, founder Steve Ellis slept on a friend’s basement couch and worked from early morning until late at night.

Clif Bar’s Gary Erickson, kept his day job working in a bicycle factory for two years, all while sleeping in a garage.

Dermalogica’s Jane Wurwand worked 16 hours a day, every day, and lived a meager existence. “A big night out was a burger on a Friday night. That was huge,” she said. “We saved everything.”

2. Finance creatively

In addition to living on a tight budget, you’ll have to get creative about raising capital for your venture. Some How I Built This founders borrowed money from their moms, some from venture capitalists, but many hatched innovative financing methods.

After being rejected by 20 investors and maxing out a bunch of credit cards, the founders of Airbnb created and sold a cereal called “Obama O’s” to pay off debt. More importantly, their cereal-box hustle impressed potential investors, landing them a spot in Y-Combinator, a prestigious accelerator for small businesses.

When times were bleak, Samuel Adam’s founder Jim Koch put a coupon on 6-packs of beer offering customers a chance to buy shares in the company. All they had to do was send a check. The result? Sixty five million dollars.

3. Prototype, launch, and refine

My perfectionist tendencies often keep me from shipping projects. I want to wait until everything is perfect before launching, which it never will be. How I Built This is a great reminder to move forward with “good enough,” learning from mistakes and consumer feedback.

“There were a lot of typos,” said VICE co-founder Suroosh Alvi of their first magazine, “but it was alive.”

Airbnb was quickly thrown together for attendees of SXSW. They only managed to attract six hosts and one customer, but they learned valuable insights to improve the product. Notably, they realized exchanging money in someone’s home is awkward, leading to the creation of online payments and a way for Airbnb to monetize the site.

4. Learn as you go

You don’t need an MBA. Most of the founders just figured out things as they went along.

Richard Branson of Virgin Brands dropped out of high school to start an anti-Vietnam War magazine. When asked how he knew how to publish a magazine, Branson responded “the best way of running a business is to just throw yourself in the deep end and learn…and ask lots of questions and listen, listen, listen.”

Virgin Brands dropped out of high school to start an anti-Vietnam War magazine. When asked how he knew how to publish a magazine, Branson responded “the best way of running a business is to just throw yourself in the deep end and learn…and ask lots of questions and listen, listen, listen.” About not going to journalism school, VICE’s Surroosh Alvi commented, “we were going to school in public.”

Even today, after Buzzfeed’s enormous success, founder and CEO Jonah Peretti feels “very unqualified for the job…I’m still figuring it out.”

5. Fake it ’til you make it

Who hasn’t heard this advice? But I was surprised to actually see it utilized by many of the builders.

Before launching TOMS Shoes, founder Blake Mycoskie had another business venture in which he convinced building owners in Nashville to sell their exterior walls for advertising. The key to getting owners to agree was to position his idea as a ‘business’. “You don’t wanna use the word ‘idea’,” he said, “because if it’s just an idea you’re not going to inspire a lot of confidence.”

While trying to secure their first space for WeWork, Miguel McKelvey and his partner secured a meeting the following day with a building owner but had nothing prepared. Spending all night creating a business plan, business cards, and marketing materials, McKelvey felt as if they had no credibility. To their surprise, the investors enthusiastically responded “oh, you actually have something here” and leased them the property.

Barbara Corcoran, real estate mogul and Shark Tank shark, was only seven weeks away from going out of business when she made her first apartment rental. With her first check she made a wise investment — a fancy coat. “It was the smartest thing I could have done with the money,” she said, “because in it, I felt powerful.”

5. Hire or partner with experts

Not everything can be faked so many brand builders found experts to help design their product.

Wendy Kopp of Teach for America did not know how to train teachers so “that’s why we found experienced teacher educators.”

Founder of Samuel Adams, Jim Koch, was a sixth generation brewer and knew a little bit about brewing beer, but also “realized I had to find the best brewmaster in America to help me…He turned me down at first.”

6. Persist in face of rejection

When times have gotten tough in my entrepreneurial endeavors, it has been tempting to tuck my tail between my legs and walk away. How I Built This has given me permission to be persistent.

In trying to find partners for Rent the Runway, Jenn Hyman was on the way to a second meeting with fashion designer Diane von Furstenburg when von Fursternburg’s assistant called to cancel the meeting. Hyman acted like she had a bad connection, hung up, and showed up anyway. Furstenburg was not interested in partnering, but introduced Hyman to Nieman Marcus, which helped get Rent the Runway off the ground.

In trying to gain ownership of the phone number 1–800-GOT-JUNK, founder Brian Scudamore made about 60 calls to find and convince the owner to transfer the number to him. “I could have given up after call 54 or 55,” he said. “I just kept going.”

7. Tell white lies

I don’t necessarily condone these examples, but according to RXBar’s founder Peter Rahal, “In the early stages of a business, you can’t break the law, but you need to bend the rules a little bit.”

In order to convince a grocery store owner to carry his yogurt, Stonyfield founder Gary Hirshberg had his friends call the grocer and ask for Stonyfield yogurt by name. The grocer later called Hirshberg claiming demand had gone off the charts.

VICE’s founder said in a media interview that a certain investor was interested in buying VICE. This investor, who had never even heard of VICE, caught wind of the story, reached out to VICE and ended up buying 25% of the company.

8. Steal from other industries

Innovation often occurs at the intersection of ideas from different disciplines and there were many instances where How I Built This founders borrowed from other places.

1–800-GOT-JUNK’s name was inspired by 1–800-Flowers and the “Got Milk” campaign.

Before TOMS Shoes, founder Blake Mycoskie had a business of selling ads for music albums on the side of buildings in Nashville — an idea he borrowed from movie ads on Sunset Boulevard in Los Angeles.

9. Remember that marketing and PR actually work

I’ve been a marketer for almost two decades and still sometimes forget that marketing actually works. It doesn’t have to be rocket science — just get your brand in front of people.

In order to generate users of dating app Bumble, Whitney Wolfe who also co-founded Tinder, went to sorority houses claiming there were a ton of frat guys on the Bumble app waiting to connect with them. She then ran over to fraternity houses and told them that a bunch of sorority girls were on the app waiting for them.

Barbara Corchoran invented a NYC real estate newsletter called The Corchoran Report and mailed it to the New York Times, who ended up quoting her on the front page of the real estate section. It gave her instant credibility and within one day she became a recognizable name to potential customers.

10. Capitalize on a previously unsatisfied consumer need

Before any of the above practices should be implemented, you obviously have to have a good idea. A key criterion for a good idea is that it meets a consumer need, ideally a previously unsatisfied one.

Rent the Runway was inspired by Jenn Hyman observing that her sister needed new outfits to wear for big events that she had not already been seen wearing on social media.

Clif Bar was created by an avid cyclist who reached his breaking point of eating gross, highly processed energy bars, so he figured out how to make a good tasting, whole-ingredient-based bar himself.

Finally, even if you already know all of this stuff, How I Built This is a great cheerleader, always providing a healthy dose of confidence and motivation.

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