“Only make new mistakes” … by Nick West
The 2008 market implosion forced my dad to get creative. He was as deeply tied to the mortgage industry as it gets when the bottom fell out. I had been interning at his company when we got the call: “The bank’s mortgage lending arm is going under, your shares will no longer be worth…anything.” 25 years in the industry gone down the drain.
An entrepreneur at heart though, he was not one to sit around and wait for the market to come back.
My dad and I then teamed up to forge a new path down an unknown territory. We did what any blissfully delusional entrepreneurs would do — start a company in an industry neither of us had experience in, and look to create an entirely new category of products.
We found a niche based on something we wanted, but couldn’t find for our own lives, did our research, raised a substantial amount of startup capital by selling a dream, and had a fully operating company with sales in the 100’s of thousands within a year. At one point; however, we made a fatal mistake.
We were selling 5 different products while sales trends were pointing to substantial growth with only one. The only problem: we didn’t ‘have enough time or data under our belts’ to decide the fate of the other 4 products, as one of our business partners explained. We wanted to cut our losses, but didn’t fight hard enough for what we knew was the right decision. The company continued to carry excess inventory for those 4 products as our core product continued it’s path of healthy growth.
Competitors began springing up. When we started the category, 2-3 similar products were competing. In a year, there were over 50 clones, most of which were focusing on the niche of our best selling product. They quickly gained a vital advantage: focus. With one product to promote, these vultures poured marketing dollars towards publicizing the functions and benefits of what had become obviously the most popular product area.
Our thinly spread marketing budget and a salesforce focused on 5 different products combined to form a self-destructive business combination. We ended up selling our shares to our investors and the company was eventually sold at a fireshare price, now living under a different banner. To hand your baby over to a new owner is a painful experience.
As any business professor, past entrepreneur, and generally successful person will tell you however, those who eventually succeed, are the ones who have learned from their mistakes. This experience taught me two business and life lessons that now guide my every action:
1. Don’t spread yourself too thin…
Figuring out your actual “life-bandwidth” is vital in order to prevent a situation with diminishing returns. The people who say they are great ‘multi-taskers,’ are often the ones who are sacrificing quality for quantity. Take inventory of your current situation, evaluate how effectively your efforts are moving you towards your goals, and iterate/innovate accordingly, while figuring out ways to shave off the fatty distractors. Along the same lines, be honest with yourself with your workload, and the significance of your goals. Are you looking to completely change your career, but need to put in a lot of work outside of your current job to gain credibility in a new industry? Maybe now’s not the time to also join a co-ed kickball team. You didn’t see The Beatles practicing water polo just in case music didn’t work out. Be realistic, map out the resources and time you’ll need, and ruthlessly defend that bandwidth you’ve created for yourself until you’ve proved you can attain that goal, or you have to go in another direction. True friends will understand this dedication.
2. When you’re ready to fight, fight (But Prepare First)
Regret is a dish served in hell. Or something like that? I don’t remember the saying. Either way, you have to talk yourself into trusting your instincts. If you want to quit your job, or you have an inclination that shaving off products 2,3,4,and 5 in your life will prove to be positive in the long-run, then take the time to prove or disprove whether this new path is a good idea.
So many people never pursue their dreams, because they don’t put in the work to simply convince themselves it’s a risk worth taking. Even on a less risky-level, you can gain new skills and experience new places by taking that inventory as explained above, and then figuring our what it is you need to do, or what it is you need to sacrifice in order to introduce that new-ness into your life. This path may require different/more/less resources than you currently have at your disposal.
This doesn’t mean it’s not possible, it just means that you have to do a little bit more legwork, and move around some of your component parts to see whether or not what you want to achieve or experience is realistic in the near future. If it isn’t, and you’re still truly passionate about it, then don’t give up. Just sequence your goal into two parts: 1) This is what I have to do get all of the moving pieces in place, and then 2) Having moved those parts into place, I can then begin to ruthlessly defend that goal with the bandwidth I have identified. Then, go and fight for it.
To sum it up in one brilliant quote, “Only make new mistakes.”
I would love to hear some other business wisdom you’ve acquired. Comment below!