5 Mistakes I've Made So You Don't Have To

While failure may be overrated, that doesn't mean you
shouldn't learn from it when it happens. You're that
much better off if you can learn from the mistakes
someone else has made, rather than having to make
them yourself. As the proverb goes, "A wise man learns
by the experience of others; a fool, by his own." In that
sense I may be a fool, but if I am, I'm offering you the
chance to be wise and learn from my mistakes rather
than repeating them.
In my years as an entrepreneur I've made enough
mistakes to fill a book (which I'm working on), but here
are five of the larger ones:
Ignoring wise advice. I've had some great mentors over
the years. It's a pity that when I most needed to heed
their advice, I ignored it. I'm sure it pained them to see
me make mistakes they had told me how to avoid. But I
was stubborn and thought I knew better. If you don't
have a mentor who tells you when you're wrong -- get
one, and listen to him or her.
Choosing the wrong partner. I started a business and
brought on two partners. They were both good guys, but
they weren't the right guys. One of them I brought on
after only knowing him for 10 minutes. By the time we
parted ways I figured the mistake I had made was
having partners, and I spent the next 10 years with no
partner. Two years ago I decided I needed a partner
again. After a year-long search and a test period, I found
the right one and it has made an amazing difference in
my business. When I say "amazing," I mean our monthly
revenues have doubled in the past four months and
we're on track to double again in the next four.
Related: 4 Lessons I Wish I Learned Before Going
Public
Being too easily satisfied. For years my business would
grow, plateau, retreat, and then the process would start
over again. I never got past a certain point. It was
because I was too easily satisfied, and felt like I could
take a break. I learned firsthand the truth in the saying
that if you're not growing, you're dying. If you ever
become satisfied with where you are, you either need to
set loftier goals or change your line of work.
Borrowing from the IRS. About 10 years ago I reached a
point in my business where money would come in from
a client, and I had the choice to give employees their
paychecks on time, or pay the IRS. If I paid the IRS, the
employees would quit, I wouldn't be able to continue
providing services and I would go out of business. If I
paid the employees, the IRS would eventually come after
me, but perhaps by that time things would have turned
around and I could pay them off.
Let me make myself clear -- if you find yourself in this
situation, pay the IRS first. You've heard of a loan shark
breaking a borrower's kneecaps when a loan wasn't paid
on time? Based on my experience "borrowing" from the
IRS, I'd rather borrow from a loan shark. At least you
can reason with a loan shark.
Getting in debt. Better yet, follow Dave Ramsey's advice
and don't borrow from anyone. You can get in debt as
fast as you can spend money, but you only get out as
fast as you have profits. Even with a small-service
business, it's easy to rack up $500,000 in debt and have
nothing to show for it, and a very long horizon for paying
it all off. Trust me, I was there, and it's not a fun place.
Debt allowed me to cover up a lot of mistakes, and it
wasn't until the well dried up that I had to fix those
problems and make my business successful. Looking
back, I wish I never would have taken on any debt at all,
because it would have forced me to be wiser from day
one.
These days I make fewer mistakes than I used to, but
much of my ability to dodge bad situations comes from
painful experiences. Take my advice -- it's better to learn
by watching someone else make the mistakes.