You probably heard them. The famous “14 Leadership Principles of Amazon.” Those are the set of principles Amazon lives by every day and does everything from coming up with new ideas to building new solutions and are the pillars of Amazon’s colossal success.
But do you know what? They can definitely help new startups and entrepreneurs. All you have to do is to follow them and use them to succeed. That’s what this email is all about, my take on how you can use them to succeed as a startup and entrepreneur. But I won’t be discussing all the 14 principles and settle down for the 5 that matters more.
1. Customer Obsession
It’s simple, straightforward, and a no-brainer at all. We entrepreneurs exist because of the customers and for the customers. Our success or failure is defined by our ability to acquire and retain customers to our products or services.
And you can do it only when you put the customer first. Don’t pick an idea or a feature or problem to solve or start a business because you like it or you believe it’s a good one and it’ll work. Instead, put the customer first and ask these questions.
- Will they like your idea?
- Will the feature matter to them?
- Is the problem something they really want to be solved?
- Will your product or service be the right solution to them?
And before making a big or small decision, ask yourself, “what will your customer say?” Remember, it is easy to put things like profit, revenue, sales, conversion rate, margin, revenue per transaction, and so on first because it’s those are the numbers that define the success.
But you won’t get there if you aren’t focusing on the customers because it’s your customers who drive those numbers. Whether you succeed or fail depends on how much your customers like your product or service, and that’ll happen only when you focus on them.
Entrepreneurship comes with ownership to things you do and build, and ownership is about two things
- Prioritizing long-term over short-term goals and
- Acting on behalf of the team and the company.
As an entrepreneur, everything is your job – ideating, validating, prioritizing features for the MVP, selling it to the first customers, hiring, scaling, and everything else, is your job. While doing them, you should always prioritize long-term goals over short-term ones.
For example, you might be tempted to pick a feature that’ll help you sell more units tomorrow, which in turn can help you in valuation and raising funds. It’s a reasonable temptation, but you should avoid yielding to it. Because doing so might set wrong expectations and result in disappointment in the future, thus hurting your reputation and sales numbers.
I’ve seen it happen lots and lots of times and good entrepreneurs get burned because of that. Some choose to sell at low prices to acquire their first thousand customers or grow their customer base at a faster rate, but then it becomes impossible to raise the prices and economics let them down and fail. As much as tomorrow is important, your end goal is way ahead of you. Don’t lose your sight.
Then we have this. Once you start a business, you become an entrepreneur, and whatever you do becomes part of your business. Every decision you make, every word you utter, and everything you do isn’t something you do in your personal capacity. It’s seen as the “entrepreneur you” making those decisions or taking those calls. You should remember that and act accordingly. And that’s what ownership is all about.
3. Have the backbone to disagree & commit
As an entrepreneur, there will be moments when you need to put your foot down and say in clear terms that you disagree and moments where you need to throw all your support behind an idea or something. And you need the backbone to do both. Don’t take me wrong.
As the commitments and responsibilities grow, you’ll feel it becoming too difficult to say the straightforward yes or no. You will always be worried about what if you make the wrong decision. Too much is at stake – your success, your team, your supporters, and investors.
But the fact is, as the commitments and responsibilities grow, it is imperative to say no definitely and say yes affirmatively at times.
So don’t hesitate or think twice. Do what it takes. Have the backbone.
Another no-brainer. Spend wisely or don’t spend needlessly. It might sound repetitive, but it is probably the thing that can make you or break you. In the early stages, you are probably running everything on your savings or the little fund you managed to raise from friends and family or living off your credit cards. Each penny is crucial until you get your first sale.
Only spend on things you absolutely need, not the ones you want. Before you take your credit card out to spend on something, ask whether it is something you really need and do you need right now?
Don’t buy something because it might come handy in a couple of months or a year. For example, you might consider buying a survey tool because it’s available at a considerable discount. It makes sense to save some bucks on something you might use in the future.
But before buying, do the math. How much is the price? How much are you saving? How much will you be spending while parking it without using? Can you use the cash on something more important right now?
Do the math and then decide. Remember, hundreds of businesses have failed because they didn’t have the cash to spend at the crunch time, sometimes very close to their finishing line. Don’t become another sad story of that sort. Be frugal.
5. Earn Trust
Believe me, trust is the deal-breaker, and you need it in every step of your entrepreneurial journey. When you are trying to convince your family that your business idea is safe and sound, you need them to trust that you can pull it off. Otherwise, you might not get their approval.
Your team should trust your idea and your execution skills to stay committed behind you during weathering times. Your prospects should trust that your solution is better than that of others to buy your product or service. Your investors should trust you, and your product will be a safe bet for their investment and bring good returns to invest in your idea.
It is impossible to live through a day without needing someone to trust you. And trust doesn’t happen overnight.
You have to build it brick by brick through your actions and reactions. It needs hundreds of right activities to gain trust, but one wrong move to lose everything. So focus on earning trust and retaining it.
As I said, it could be the deal-breaker. And those are the 5 principles I’ve handpicked for you, principles I believe can guide you to success like Amazon. But I recommend you to check the rest of the principles, and you can’t go wrong following them.