5 Crucial Lessons for Building Your Business
In 2008, just as the financial crisis hit, von Tobel decided to drop out of Harvard Business School and start her own company. Now, after years of running a business that has raised more than $41 million in multiple rounds of funding, she often shares advice with new entrepreneurs just starting out.
At the Inc. Women's Summit last fall, she offered some of her biggest lessons learned. Edited excerpts on selected subjects follow. --Will Yacowicz
Identify a problem.
Make sure you really know what the issue is and identify the problem very clearly. . . For LearnVest, the issue was that the 99 percent of the country who has less than $1 million doesn't have access to really great financial advice. You have to get specific and know what exactly the problem is. If you have six, seven, eight, or 10 problems, you won't be able to focus.
Don't be afraid to take risks.
When Lehman Brothers was going under, arguably no one in their right mind would've dropped out of Harvard--a beautifully cushy roadmap to have a future. But I decided when everyone zigs, you have to zag.
When I was jumping off the cliff, I wasn't saying I'd figure it out when I get down.
It's important to have a really clear strategy so when you are in business, you only have to make micro-strategy changes.
Don't bet your life savings.
That is the worst thing you can do as a certified financial planner for your life, if you take so much risk that you can't think clearly. . . If you are literally blindly desperate, because you are worried if the business does not work your entire family and house goes under, you're not going to be in a clear, steady position of power. And that's what you need to be when running a business.
Have a personal financial stake.
If it is $5,000 or $75,000, you have to be invested. I started LearnVest with a tiny savings account where I paid designers, technologists, and even bartered. . . Because I started with paying for things myself with my own savings, it sharpened my focus of how to spend money. The discipline, now that I raised $41 million, has made investors trust me because I . . . got the company where it is today spending little money.
Vet your investors.
Every single time I was raising money, I was marrying someone. In reality, LearnVest will be a project I build over the next decade or two decades, and those people are literally in the boat with me in the middle of the Atlantic, sailing the storms that may come.
Every dollar is as green as the next until it's not. And it's not, unless it comes with brains, connections, power, and the ability to tell me I have a huge blind spot.