Entrepreneurship Advice from Marc Hedlund, CEO of Wesabe

This is a guest post from Marc Hedlund, co-founder and CEO of Wesabe, a web-based personal finance tool. Marc was formerly an entrepreneur-in-residence at O’Reilly Media. He also blogs about money at Wheaties for Your Wallet.

A couple weeks ago, J.D. had a conversation with some friends about starting a small business. I liked a lot of what was said, but I’ve had some different experiences, and would like to offer my perspective. Here are some things I’ve learned from my entrepreneurial endeavors.

Starting a business with friends can be fantastic
Both of the companies I’ve co-founded have been with long-time friends, and while of course there were hard parts about it, in many ways it was a huge help.  We knew each other well enough to figure out how the other would react in a lot of situations, and had a base level of trust that is always helpful.  Of course there are plenty of counterexamples, but it can work.  

What matters is that you have a partner with whom you can communicate — if that person is a friend, great.  

Write someone and ask them for help every day
It’s amazing how well this works.  Just make a habit of coming up with one person each day that might be able to help you in some way — with an introduction, an idea, a conversation, anything. If you think of someone you already know, then it’s easy to ask for help, but don’t be bashful about asking people you don’t know for help.  

When you tell people you’re working on starting your own business, many of them will get excited or interested, and be willing to offer a hand. Don’t be discouraged if you don’t hear back — just try someone else the next day. When you’re starting a new business no one knows what you’re up to, so reaching out and asking for help very often can do an enormous amount to get things rolling.

People matter more than anything
When you’re looking for partners, employees, attorneys, accountants, or anyone else to be a part of your business, find someone you really get excited about working with, or just keep waiting and looking.  Don’t get caught up thinking you need someone, just anyone, to support you.  It’s far better to wait for a star.  

The early people in any company shape everything about it — its enthusiasm, public face, ethics, and quality. You can’t afford to have any of those aspects be anything less than stellar when you’re starting your own business. (If you’re not sure about a person, try using them as a contractor first, and bring them on full-time when you’ve had more time to evaluate them.)

Don’t worry about the idea
Entrepreneurs often get all worked up — or hung up — on The Idea; that is, what business exactly they’re going to pursue. Don’t worry so much about The Idea. Choose something you know a lot about and see a need for, and go for it.

The people you work with matter more than The Idea; hardworking, talented people working on the wrong idea will figure that out and adjust, while the wrong people on the right idea are likely doomed anyways.  

The only thing that really matters about The Idea is how you (and your partners) feel about it.  If you can’t stop thinking about it for weeks on end, get up out of bed to write down brainstorms about it, and don’t get tired of working on it, that’s the right idea.  If you have to convince yourself to keep going on The Idea, that’s the wrong one.

Take money from other people as an absolute last resort
Many entrepreneurs get an idea, write up a presentation about it, and hit the road looking for angel or venture capital investors.  Don’t do that.

First, investors will always prefer to invest in running, growing businesses, not ideas; and second, you will immediately give up control of your business to people you likely don’t know very well.  Supportive, patient investors definitely do exist, but they are the rare exceptions.  

Take investment only to accomplish a specific goal for your existing business that you know you can’t achieve any other way.

Know your customers
Do everything you can to put yourself in direct, frequent contact with the people who will be giving you money — your market.  When selling to consumers, make sure you’re talking to someone who would actually have a pressing need for whatever you’re selling; when selling to companies, make sure you’re talking to the person who could actually authorize a purchase of whatever you’re selling.  

Anyone in your company shaping its products or services should be in direct, frequent contact with your market, too.  Listen to your market.  Talk to them all the time.  Ask them if what you sell is working for them, and take everything they say seriously.  

Most importantly: ignore every other source of “feedback” — competitors, reviewers, two-bit commentators, whatever.  If what these other sources have to say matters, you’ll hear it from your market directly.  If you don’t, what the other sources say is irrelevant.

Have confidence in yourself
Things are going to suck for a while, pretty often.  You’ll win sometimes and lose sometimes, often on the same day.  Take care of your home life, make sure you have great support from your family and friends, and listen to your gut.  These simple, basic steps will get you through the dark times that inevitably come, and lead you to the rewards that can follow.

Treat people well
Most entrepreneurs fail several times before they have a success.  If you can fail with your integrity intact, you’ll build a network of people ready to help you when you’re ready to try again.

6 Ways to Make Your Own Luck BY NICOLE CARTER

While luck isn't an exact science, there are certainly ways to make yourself more open to opportunity. Here are six easy ways.

Many entrepreneurs believe their success is in part due to a little bit of luck-- that chance meeting with a potential investor or that dinner conversation that sparks a new idea. In fact, a new study by networking site LinkedIn found that 84 percent of 7,000 professionals they surveyed say they believe in career luck.

But let's face it: There isn't an exact science to luck. You can't predict it. However, there have been plenty of successful entrepreneurs, authors, and even researchers who've tried to map out just what makes someone lucky.

Here are a few of the top tips for cultivating your own luck. 

1. Be humble. Part of cultivating luck, writes author and venture capitalist Athony Tjan for Harvard Business Review, is increasing your influence. And the best way to do that is through cultivating something counterintuitive: humility. He added: "People can mistake humility for weakness and avoid it so as not to lose perceived power...You can make more friends in two months by becoming interested in other people than you can in two years by trying to get other people interested in you."

2. Roll up your sleeves. This seems pretty obvious to those who consider themselves lucky. According to the LinkedIn survey, a whopping 70 percent of those surveyed said a strong work ethic was the number one thing that makes someone lucky. But to work hard, you also have to be skilled. Nearly half of the respondents in the same survey said that skills were another contributor to career luck.

3. Be generous. Tjan also writes, "Never lose the spirit of generosity; instead, allocate it appropriately. Remaining a mentor to others, connecting with community activities, simply saying more 'thank-yous,' and doing more things without over-thinking the potential 'value-exchange' equation, is a pay-it-forward attitude that in the long-run usually pays off in spades. Plus, it just feels good to be generous."

4. Be ready. Good to Great author Jim Collins has said that if one cannot predict luck, the question to then ask is: "Do you have a high return on luck?" In a New York Times essay he revealed this concept using Bill Gates as an example. He wrote: "Thousands of people could have done the same thing that Mr. Gates did, at the same time. But they didn't...How many of them changed their life plans--and cut their sleep to near zero, essentially inhaling food so as not to let eating interfere with work--to throw themselves into writing Basic for the Altair? How many defied their parents, dropped out of college and moved to Albuquerque to work with the Altair? That’s not luck--that's return on luck."

5. Go with your gut. Who better than the late Steve Jobs to describe why trusting in your gut instincts may be the best way to ensure your luck in the future? In his famous speech to a graduating class at Stanford he said, "You can't connect the dots looking forward; you can only connect them looking backwards. So you have to trust that the dots will somehow connect in your future. You have to trust in something—your gut, destiny, life, karma, whatever. This approach has never let me down, and it has made all the difference in my life." Add to that, according to the LinkedIn survey, nearly half of the respondents said that "using your intuition" has been an important factor in their career luck.

6. Simply believe that you are lucky. A recent study from psychologist and University of Hertfordshire Professor Richard Wiseman found that simply believing you are lucky can create positive outcomes. He took two groups of people: one that considered themselves "lucky," and another that considered themselves "unlucky." He gave both groups newspapers and asked everyone to report back how many photos were in the issue as quickly as possible. The lucky people came back with the answer in seconds, much faster than the unlucky group. Why? Because on page two of the paper, there was an ad that read "Stop counting. There are 43 photographs in this newspaper."

Wiseman concluded: "Unlucky people miss chance opportunities because they are too focused on looking for something else. They go to parties intent on finding their perfect partner, and so miss opportunities to make good friends. They look through the newspaper determined to find certain job advertisements and, as a result, miss other types of jobs. Lucky people are more relaxed and open, and therefore see what is there, rather than just what they are looking for."