Entrepreneur Office Hours - Issue #99
Do you have enough empathy?
Empathy is like an entrepreneurial superpower. By that I mean successful entrepreneurs are great at getting into the heads of other people. That includes customers, employees, and, of course, investors.
Conversely, not-so-successful entrepreneurs don’t do this. They’re selfish. They focus on what’s most important to them, and this selfishness manifests itself in the ways they talk about their companies.
I explain a common example of this kind of entrepreneurial selfishness in this issue’s featured article. It’s about fundraising pitches and how founders tend to talk more about what matters to them than what matters to their potential investors.
I explore a similar theme (among others), in this week’s Web Masters episode alongside an entrepreneur named Nugget McNett. He’s one of the co-founders of FlightAware, and he championed a customer-centric approach the helped the company focus on building what users actually wanted rather than what the founders thought users needed.
If that’s not interesting to you, the podcast also explains why a 40-something-year-old man likes being called Nugget. Strangely enough, it’s for a reason related to customer empathy. But you’ll have to listen to understand how the two things are related.
Investors rarely explain why they reject entrepreneurs. When they do, you should pay attention. That’s what I did, and it made a huge difference in how I gave my fundraising pitch.
Airlines aren't the first things that come to mind when most people think about how the Internet has changed the world, but, as with so many other industries, the Web had a huge impact on commercial aviation. One of those big impacts was a result of FlightAware, a story I got to explore with David "Nugget" McNett on the new episode of Web Masters.
Listen now on:
…or search “Web Masters” wherever you listen to your favorite podcasts.
FROM THE ARCHIVES…
Yes, you should talk about your team when pitching your startup, but it’s not as important as most entrepreneurs think. Make sure you put it somewhere that won’t undercut the overall impact of your pitch.
Office Hours Q&A
I run a small ecommerce website. It’s nothing “venture style,” but it provides a good living. I guess the correct phrase is “lifestyle business.”
Over the past few months there’s been an increasing number of companies reaching out to me asking if I’m interested in selling my business. I honestly hadn’t thought about it, but it seems like something that could be worth exploring.
Do you have any advice about selling a business? How do you know if or when it’s the right time to sell? And, if I do decide to sell, Is it the kind of thing I should be talking with these companies that are contacting me? Or would it be better to just do it on my own and these companies reaching out are more like predatory middle men?
If you’ve listened to my podcast, you know I’m sponsored by a mergers and acquisitions company (Latona’s… check out their site and tell them Aaron sent you! 😉). It’s one of those companies you reference that helps buy/sell profitable Internet businesses like what it sounds like you’ve been building.
In other words, I might be biased in my answer, but hopefully I can keep this answer neutral enough that it doesn’t seem like I’m trying to promote anything.
First of all, like in any industry, there are going to be good companies and bad companies. Are there some “predatory middle men” just trying to exploit you and your hard work for a few bucks? Probably. Are all of the companies reaching out to you trying to exploit you? I doubt it. As with any business, they need to get customers, and one way for them to get customers is by reaching out to the owners of profitable Internet businesses (i.e. people like you). It’s hard to fault them for that. After all, you wouldn’t get mad at your favorite clothing store for sending you an email about their Fall sale.
As for whether or not getting help from a broker is useful, with the right one, yes, I think it would be helpful. After all, selling a business isn’t like selling a car. It involves lots of complex legal and logistical “ins and outs” that you probably don’t want to screw up. At the very least, you’ll need to solicit an experienced lawyer who can help you through the process. And, honestly, considering the costs of lawyers, you’d probably save some money by getting as much help as possible during the process from a non-lawyer.
Regarding knowing if/when it’s the time to sell, that’s a very personal decision. It requires answering questions like:
How do you feel about the company you’re currently running?
Are you passionate about it?
Does the work excite you?
Do you feel fulfilled at the end of your work day?
Are you satisfied with the income it generates?
Do you see ways it could be growing?
Are you willing to execute those growth strategies?
Do you see any major hurdles on the horizon that you don’t want to deal with?
Do you need to get out of the company before those hurdles get too close?
Obviously, I can’t answer any of those questions for you. However, I can tell you this: too many entrepreneurs feel like they’re somehow obligated to continue running the companies they create. But that’s not true.
Just because you started a company, you don’t have to keep running it. If you’re tired of running it – or if something else has come up in your life that’s preventing you from running it – you’re fully within your rights to step aside. In fact, it might be best for everyone involved if you step aside before your disinterest (or inability) hurts the company.
Don’t hold on any longer than you should. And, honestly, if you’re seriously considering selling, that’s probably a good indicator that you should be selling.
Got startup questions of your own? Reply to this email with whatever you want to know, and I’ll do my best to answer!