Founder and CEO of Self Financial, an Austin-based FinTech empowering people to build credit, save money and reach their goals.
It goes without saying that every entrepreneur faces setbacks and challenges while building a business. The challenge is how to process those setbacks and alchemize them into the ultimate success of your company.
This has been driven home for me in any number of experiences over the last several years as I launched, built and grew Self Financial, a consumer credit and savings building company.
However, these experiences aren’t unique to me. Most entrepreneurs face these obstacles at some point in their company’s life cycle. However, struggling with an obstacle or challenge isn’t a sign of failure. It’s how you deal with that setback that can determine whether your company thrives or dies.
1. Fuel your company with a mission that moves you.
Setback: I believe most companies today want to make money responsibly. That’s certainly true with me. But money can’t be the big “why” for your business. It can only sustain you in the short run, over little hurdles. To go the distance and conquer big challenges you’ll undoubtedly face, you need something deeper and stronger.
Success: The key to sustaining that kind of motivation is a strong belief in a mission that engages you. That’s what helps you stand firm while you figure out how to get the right people and processes in place.
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It’s all well and good to love what you do, and you absolutely should love it. If you’re not having a little fun, it’s going to be a real struggle. But even more important than the passion is the faith in the mission.
2. Raise more money than you think you need.
Setback: Our company now has 200 employees, but we started with only a few. One of the first and biggest setbacks I encountered in building the company from the ground up was fundraising. I’d never needed to raise capital for a startup, and I quickly learned that raising venture capital is wholly different from simply running a business.
Finding venture capital was difficult. So, I began applying on behalf of the company to the Techstars Accelerator. When we were accepted in 2015, a host of opportunities opened up, leading us to our first investor.
Success: Joining an accelerator was a terrific growth experience for us. So many entrepreneurs underestimate how much money they need for their businesses.
Raise a lot more money than you think you may need. No founder wants to continually face the threat of not having enough runway to cover operating costs. It’s also important to focus on balancing fundraising with securing the highest possible valuation.
3. Build your network strategically.
Setback: As an introvert, networking doesn’t come naturally to me. Before joining the accelerator, I had about 80 LinkedIn connections. Our participation in it gave me the chance to connect with lots of skilled, talented and helpful people. The power of networking and connecting with people who have different skills and information required a real mindset shift for me.
Success: I have to force myself to network, but it’s such an important thing for entrepreneurs to do. Building a network of smart, skilled people who are happy to help each other can unlock new opportunities for your company. Build a network of C-suite leaders, including CEOs who know much more than you do and mentor you. They may help you reach your goals more effectively.
4. Hire the right people whose skill sets complement your own.
Setback: For the first several months, I was the one marketing the company. It’s not where my strengths lie. Yet we were operating on the proverbial shoestring, so we didn’t put a marketing team in place until three years ago. At that time, we had about 25 people in the company, so it made more sense to me to take a DIY approach.
Then we hired our first chief marketing officer, who then promptly hired five more professionals for his team. If I had been able to hire that CMO earlier, our company would have gotten traction much faster.
Success: It might be a cliche, but it’s still true: Don’t try to do everything yourself. Sure, you can probably build an acceptable website if you use the right tools and work hard at it. But hire someone else for that task. Your hours could be better spent growing your business and managing your team to success.
5. Look for feedback from people who will be honest with you.
Setback: It’s difficult for an entrepreneur to obtain truly candid advice, yet it’s invaluable. When you pitch an investor, for example, they might say something like, “Come back to me when you have more traction.” That helps them save face, but what about your business plan? Do they spot challenges you can’t see? Possibly, but if they don’t share that information, you’ll have to figure it out on your own.
On the other hand, if they say, “This business idea will never work and here’s why,” and your company achieves wild success, it’s a hit on their reputation for being able to spot winners. This may prevent investors from truly speaking their minds. People want to be cautious and conservative with others, so it can be challenging to get candid feedback.
Success: One of the ways I’ve managed to get candid assessments is by building a network of people who don’t have anything to lose by being honest with me. Finding CEOs, investors and others who will absolutely not invest in your business and so have nothing to gain or lose by being honest is a game changer. It’s helped me tremendously.
Setbacks lead to success.
See the opportunity behind every obstacle, and keep putting that mindset shift into practice. Roadblocks are really just chances to recenter your business and achieve bigger goals.