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10 Business Mistakes  That Broke Me…      Literally!       Neil Patel      KISSmetrics
1. Do you have the right business partner?
How I used to pickthem •   Friendship •   Ivy league schools •   Where they cool? •   Would fall in line
The Crazy Egg story •   I gave away 10% of the company •   Got sued by them for     mismanagement of funds •   Showed the ...
Lessons learned •   A partnership is like a marriage •   Have good contracts with out     clauses. •   Vest shares •   Pic...
1. Do you have the right business partner?   ------------------------------------------------------   --2. Time isn’t on y...
Execute fast Move as fast as possible. If you    move slow like a large company, someone    will beat you to the punch. If...
The Serph story •   Had business partners •   Spent $1,000,000 in borrowed     money •   Launched nothing in 12 months •  ...
Lessons learned •   Set firm deadlines •   Don’t worry about perfection. •   Create small milestones and     goals •   Hol...
1. Do you have the right business partner?   ------------------------------------------------------   --2. Time isn’t on y...
There isn’t enoughtime If you are lucky you’ll be able to     spend 70 to 80 hours a week working on     your business. If...
The ACS story •   Tried to expand in too many     directions (ppc software, web     analytics, facebook apps) •   Lost foc...
Lessons learned •   Have laser focus until revenue     flattens or growth slows down. •   Focus on improving instead of   ...
1. Do you have the right business partner?   ------------------------------------------------------   --2. Time isn’t on y...
Your customers payyou You don’t pay yourself, your    customers do. So don’t just build products for yourself, build them ...
The KISSmetrics story •   Wasted $1,000,000 on version     one •   Spent 1 year on version one •   Version 2 didn’t work e...
Lessons learned •   Create minimal viable products •   Continue to iterate until you have     product market fit, then go ...
1. Do you have the right business partner?   ------------------------------------------------------   --2. Time isn’t on y...
Have a clear mind When you’re emotional, you’ll make decisions that make you feel good instead of making decisions that wi...
The [mystery] story •   Was an advisor to a company •   Made them $200,000 in 60 days •   They let me go, my shares didn’t...
Lessons learned •   Never burn bridges •   There are always two sides to     each story •   Don’t make rash decisions, thi...
1. Do you have the right business partner?   ------------------------------------------------------   --2. Time isn’t on y...
Loyalty matters Hiring good employees isn’t enough. You need loyal employees because shit happens that you can’t control.
The Fruitcast story In 2005 I lost the opportunity to sell     the company to “search giant” because a key employee didn’t...
Lessons learned •   Hire people who fit within your     culture •   Make sure everyone has similar     short and long term...
1. Do you have the right business partner?   ------------------------------------------------------   --2. Time isn’t on y...
Sell when you can If someone is offering you a lot of money for your company, take it… especially when it makes sense.    ...
The Crazy Egg story •   Spent $250,000 to launch the     company •   Had a verbal buy out offer for     $6,00,000 •   Blee...
Lessons learned •   What goes up must come down •   You don’t need much money to     be happy •   If it is life changing, ...
7. Don’t be too greedy   ------------------------------------------------------   --8. Frugality is sexy
It’s hard to makemoney It’s easier to save money than it is to make it. Because of that, you should always save it, as you...
The ACS story •   Tried to buy a Maserati •   Spent too much money on     building software •   Recession hit us hard •   ...
Lessons learned •   Save your money while you can •   Cut your salary before you fire •   Don’t waste money on things that...
7. Networking is work   ------------------------------------------------------   --8. Frugality is sexy ------------------...
No means not rightnow Just because someone tells you     “no”, it doesn’t mean you can’t convince     them to turn that “n...
The Crazy Egg story •   Pitched over 30 VCs to raise     money •   Everyone said no •   Were told we had a bad business • ...
Lessons learned •   No means “not right now” •   We were able to raise money for     KISSmetrics from the same     investo...
7. Networking is work    ------------------------------------------------------    --8. Frugality is sexy ----------------...
Have an open mind Don’t get offended when people give you advice. Have an open mind and    in the end it is your decision ...
The Neil Patel story Every time people called me out, I     used to get mad. I always felt people had     it out for me, a...
Lessons learned •   Embrace criticism, it just helps     you win •   You can never stop learning •   Ask for criticism, do...
Follow me onlineMy blog: QuickSprout.comTwitter: @neilpatelCompany blog:   blog.kissmetrics.com
SlidesHave questions? Contact me!Neil Patel(562) 292-3834npatel@kissmetrics.comkissmetrics.com
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Neil Patel - 7 Business Mistakes That Nearly Broke Me - SIC2012

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Mistakes… it’s something that we all make an entrepreneurs, but only a few us learn from our mistakes and prosper. In this session you’ll hear 7 big mistakes entrepreneur Neil Patel made, how he overcame them, and what he learned throughout the process. He’ll also cover the common mistakes you are likely to make in your business and how you can avoid them.

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Transcript of "Neil Patel - 7 Business Mistakes That Nearly Broke Me - SIC2012"

  1. 1. 10 Business Mistakes That Broke Me… Literally! Neil Patel KISSmetrics
  2. 2. 1. Do you have the right business partner?
  3. 3. How I used to pickthem • Friendship • Ivy league schools • Where they cool? • Would fall in line
  4. 4. The Crazy Egg story • I gave away 10% of the company • Got sued by them for mismanagement of funds • Showed the books • Bought out their shares
  5. 5. Lessons learned • A partnership is like a marriage • Have good contracts with out clauses. • Vest shares • Pick opposites • Make sure they are financially stable
  6. 6. 1. Do you have the right business partner? ------------------------------------------------------ --2. Time isn’t on your side
  7. 7. Execute fast Move as fast as possible. If you move slow like a large company, someone will beat you to the punch. If you wait 3 months to launch, you’re moving too slow.
  8. 8. The Serph story • Had business partners • Spent $1,000,000 in borrowed money • Launched nothing in 12 months • Tried to create the ultimate hosting environment
  9. 9. Lessons learned • Set firm deadlines • Don’t worry about perfection. • Create small milestones and goals • Hold individuals accountable
  10. 10. 1. Do you have the right business partner? ------------------------------------------------------ --2. Time isn’t on your side ------------------------------------------------------ --3. Focus, focus, focus
  11. 11. There isn’t enoughtime If you are lucky you’ll be able to spend 70 to 80 hours a week working on your business. If you aren’t you will only be able to spend 50 to 60 hours. There isn’t enough time to do 2 businesses.
  12. 12. The ACS story • Tried to expand in too many directions (ppc software, web analytics, facebook apps) • Lost focus on what brought in the revenue • Neglected sales channels
  13. 13. Lessons learned • Have laser focus until revenue flattens or growth slows down. • Focus on improving instead of expanding. • Double down on your core business • Continually innovate
  14. 14. 1. Do you have the right business partner? ------------------------------------------------------ --2. Time isn’t on your side ------------------------------------------------------ --3. Focus, focus, focus ------------------------------------------------------ --4. Build for your customers
  15. 15. Your customers payyou You don’t pay yourself, your customers do. So don’t just build products for yourself, build them for your customers.
  16. 16. The KISSmetrics story • Wasted $1,000,000 on version one • Spent 1 year on version one • Version 2 didn’t work either, took 6 months. • Version 3 was built for customers and took less than 30 days to launch
  17. 17. Lessons learned • Create minimal viable products • Continue to iterate until you have product market fit, then go to market • Don’t worry about perfection, it is over rated
  18. 18. 1. Do you have the right business partner? ------------------------------------------------------ --2. Time isn’t on your side ------------------------------------------------------ --3. Focus, focus, focus ------------------------------------------------------ --4. Build for your customers ------------------------------------------------------ --5. Emotions and business don’t mix
  19. 19. Have a clear mind When you’re emotional, you’ll make decisions that make you feel good instead of making decisions that will make you more money.
  20. 20. The [mystery] story • Was an advisor to a company • Made them $200,000 in 60 days • They let me go, my shares didn’t vest • They introduced me to company that signed a $500,000 deal
  21. 21. Lessons learned • Never burn bridges • There are always two sides to each story • Don’t make rash decisions, think things over for a day or two
  22. 22. 1. Do you have the right business partner? ------------------------------------------------------ --2. Time isn’t on your side ------------------------------------------------------ --3. Focus, focus, focus ------------------------------------------------------ --4. Build for your customers ------------------------------------------------------ --5. Emotions and business don’t mix ------------------------------------------------------ --6. Only hire loyal employees
  23. 23. Loyalty matters Hiring good employees isn’t enough. You need loyal employees because shit happens that you can’t control.
  24. 24. The Fruitcast story In 2005 I lost the opportunity to sell the company to “search giant” because a key employee didn’t want to work for them.
  25. 25. Lessons learned • Hire people who fit within your culture • Make sure everyone has similar short and long term goals • Be transparent
  26. 26. 1. Do you have the right business partner? ------------------------------------------------------ --2. Time isn’t on your side ------------------------------------------------------ --3. Focus, focus, focus ------------------------------------------------------ --4. Build for your customers ------------------------------------------------------ --5. Emotions and business don’t mix ------------------------------------------------------ --6. Only hire loyal employees ------------------------------------------------------ --
  27. 27. Sell when you can If someone is offering you a lot of money for your company, take it… especially when it makes sense. Don’t be too optimistic as tough times are always around the corner.
  28. 28. The Crazy Egg story • Spent $250,000 to launch the company • Had a verbal buy out offer for $6,00,000 • Bleeding $20,000 a month • I wanted $10,000,000 because the company could afford it
  29. 29. Lessons learned • What goes up must come down • You don’t need much money to be happy • If it is life changing, go for it • There is nothing wrong with having someone make money off of you
  30. 30. 7. Don’t be too greedy ------------------------------------------------------ --8. Frugality is sexy
  31. 31. It’s hard to makemoney It’s easier to save money than it is to make it. Because of that, you should always save it, as you never know when you are going to need it.
  32. 32. The ACS story • Tried to buy a Maserati • Spent too much money on building software • Recession hit us hard • Would have been a huge business if we didn’t waste our cash
  33. 33. Lessons learned • Save your money while you can • Cut your salary before you fire • Don’t waste money on things that don’t matter • There is nothing wrong with having money sitting in the bank
  34. 34. 7. Networking is work ------------------------------------------------------ --8. Frugality is sexy -------------------------------- ------------------------9. Never take “no” for an answer
  35. 35. No means not rightnow Just because someone tells you “no”, it doesn’t mean you can’t convince them to turn that “no” into a “yes”.
  36. 36. The Crazy Egg story • Pitched over 30 VCs to raise money • Everyone said no • Were told we had a bad business • We quit at fund raising
  37. 37. Lessons learned • No means “not right now” • We were able to raise money for KISSmetrics from the same investor who said no. • When someone says “no” ask them why
  38. 38. 7. Networking is work ------------------------------------------------------ --8. Frugality is sexy -------------------------------- ------------------------9. Never take “no” for an answer ------------------------------------------------------ --10. Embrace criticism
  39. 39. Have an open mind Don’t get offended when people give you advice. Have an open mind and in the end it is your decision on what you want to do.
  40. 40. The Neil Patel story Every time people called me out, I used to get mad. I always felt people had it out for me, and I was always defensive it.
  41. 41. Lessons learned • Embrace criticism, it just helps you win • You can never stop learning • Ask for criticism, don’t wait for it • Not all criticism is equal
  42. 42. Follow me onlineMy blog: QuickSprout.comTwitter: @neilpatelCompany blog: blog.kissmetrics.com
  43. 43. SlidesHave questions? Contact me!Neil Patel(562) 292-3834npatel@kissmetrics.comkissmetrics.com
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