When renowned entrepreneur Jeff Hoffman hears workshops urging small business owners to come up with an exit strategy as they create their businesses, he says, he thinks one thing: "What's your entrance strategy?"
As a frequent speaker and founder of multiple startups, Hoffman believes in the importance of coming up with a strong strategy at the outset to position your business for success. When a business focuses on money, that business is designed to fail. Instead, businesses should chase excellence because money follows excellence.
"When you build something amazing in the world, you will get paid," Hoffman says. "Until then, it doesn't matter anyway. It's just a Powerpoint."
Solve Real Problems
Entrepreneurs are constantly told to build products that solve a problem, but Hoffman sees far too many founders toiling away at a problem that matters to very few people besides themselves. When most people encounter a problem in the real world, they complain about it to their friends and social networks, then go on with their lives. Hoffman noticed problems are handled completely differently by successful entrepreneurs.
"When they encounter a problem in the world, they stop and ask the following questions," Hoffman says. "The first thing is, 'Does this bother anybody but me?' And if the answer is, 'Yes, it seems to bother everybody, this is a real problem,' then the second thing they say is, 'Is there a solution that maybe I just don't know about?'"
Focus on One Thing
When an entrepreneur tells Hoffman they have six great ideas for a startup, he immediately advises him to pick one of them. While they may be concerned about someone stealing those other five ideas, Hoffman asserts that he has never met someone who has achieved excellence by doing one-sixth of six things.
"You achieve excellence by finding something in the world that you can be the best at and being the best at that," Hoffman says.
Hoffman points to Amazon as proof of this. The company started out selling books. Once it established itself as a great online retailer, it was only natural to move into other areas. When a company does one thing and does it well, expansion will come naturally, allowing its leadership team to put those other great ideas into action.
Hire People Who Are Smarter Than You
Another tip Hoffman gives entrepreneurs relates to team building. He advises founders to hire people smarter than them in every area in which they're weak. Although this can be tough in the early days because a business owner can't afford a team, when he tries to do it all he usually will fall short.
"From day one, you should be planning to let go of everything you're not great at," Hoffman says.
Get in Your Car
While participating in a TV interview recently, Hoffman and the other CEO participants were asked where they go when they hear a good idea. The other CEOs immediately said they get their team members and go to their offices. Hoffman said he gets his car keys and heads straight for the parking lot.
Years ago, while spending the day with a successful elderly business owner, Hoffman asked how he'd succeeded when everyone had told him his concept would never work. The gentleman pointed out that his employees were extremely intelligent people but they didn't know the customers. So every other Friday, he would put on jeans and a John Deere hat and go to a diner where he bought pie for everyone. He'd talk to those customers and get to know them personally.
"The guy I was having this conversation with was named Sam Walton," Hoffman says. "Everybody said you can't build big-box retailers in little towns except the people who lived in the little towns. I spend time every other Friday where I go wherever the customer is."
With so many experts preaching advice about how to build a business, it can be difficult to know where you should really pay attention. A great place to start is by seeking to solve a problem, staying focused, hiring the right people, and listening to your customers. Simple? Yes, but they just might be the most effective strategies out there.