Actively engage in thinking yourself and encourage others to do so, as it’s the most difficult but crucial aspect of business, contrasting with merely keeping busy without thought.
When facing any problem or process, ask ‘Is it necessary?’ and ‘Can it be simplified?’ to cut through complexity and identify core issues and eliminate traditions masquerading as requirements.
Always maintain a surplus or margin of safety in resources (e.g., stock, cash) to control your circumstances, avoid forced decisions, and gain power when others are desperate.
When faced with rejection or a ’no,’ learn from the experience, adapt your approach, and try again, treating every ’no’ as research rather than a final defeat.
Instead of chasing temporary trends or betting on fleeting technologies, focus relentlessly on fundamental principles and aspects that will not change, as these create lasting success.
Develop the courage to make difficult decisions, including closing doors or ‘burning boats,’ and be willing to eliminate good options to pursue truly great ones.
Reject the idea of full delegation and accept ultimate responsibility for anything that goes wrong in the business, believing the fault lies squarely with management.
Actively guard against the natural tendency of growth to create complexity and organizational bloat by returning to foundational questions like ‘Is it necessary?’ and ‘Can it be simplified?’
Cultivate a mindset that views crises as energizing opportunities for growth and innovation, rather than sources of fear or panic, and develop an appreciation for discomfort and challenges.
When market conditions demand a significant shift, be prepared to take dramatic, decisive action rather than incremental adjustments, prioritizing speed over perfection to force an immediate market response.
Focus on controlling the underlying processes and inputs, as results are merely lagging indicators, and processes are the only things you can directly influence.
Cultivate a reputation for fairness in all dealings, striving for win-win outcomes, as this becomes a significant competitive advantage that compounds over time.
Actively learn from business failures, both your own and others’, viewing them as invaluable education gained through time and observation rather than capital investment.
When seeking investment or partnerships, strategically target influential individuals and focus on the ‘when and how’ of your approach, avoiding pestering and ensuring a well-timed, impactful interaction.
When facing intense competition and unable to compete on price or scale, make innovation your primary path forward to differentiate and escape price war traps by finding better ways.
Ensure your business is constantly revising its products to meet not only current demands but also to anticipate and address the potential demands of tomorrow.
Thoroughly believe in the product you are selling, as this conviction transforms sales into a process of genuinely demonstrating how your product benefits the prospect.
Ensure your financial statements are clear, comprehensive, and factual, serving as a prospectus without needing extensive explanation or being prepared with undue enthusiasm.
Be vigilant against the natural tendency of growth to create complexity and organizational bloat, which can erode focus and divert resources from the core business.
Actively filter for and retain team members who demonstrate resilience and can perform effectively under intense pressure and difficult conditions.
Recognize that success frequently stems from the disciplined avoidance of obvious mistakes and poor decisions, rather than relying solely on brilliance.
Even under extreme pressure, strive to act from a place of deliberate choice rather than panic, ensuring your decisions are considered and strategic.
Opt for direct communication methods like phone calls over written memos or letters, recognizing that writing can be a significant time-waster.
Seek to be surrounded by individuals who take time for serious thought before making decisions, rather than those who offer instant, unconsidered answers.
Seek satisfaction in creating genuine opportunities that empower others to help themselves and achieve independence, rather than through charity.
Cultivate a willingness to challenge widely held assumptions, as this critical thinking can provide a more powerful competitive advantage than mere knowledge.
When facing technological uncertainty, focus your efforts and investments on fundamental needs or principles that you believe will not change, rather than trying to predict which specific technology will win.
Understand that direct, firsthand experience with a product can instantly convert customers, so find ways to get your product into users’ hands.
Be aware that rapid success can create financial problems by outpacing resources, and proactively manage this mismatch between opportunity and capability to avoid running out of cash.
Furnish your operations frugally, utilizing second-hand or repurposed items that, with repairs, can serve your purpose effectively, especially in early stages.
Resist the urge to declare dividends immediately after achieving profit; instead, reinvest as much as possible back into the company to position it for future enlargement and growth.
Understand that high prices limit volume, and to sustainably lower prices and increase business, you must achieve savings in manufacturing costs through improved processes.
Extend your problem-solving focus beyond product innovation to customer relationships, addressing issues at their source to build trust that advertising cannot buy.
Engage with partners or customers who exert steady pressure for higher service and lower prices, as this can prevent complacency and continuously drive better methods.
When facing powerful incumbents, understand that the public often roots for the underdog, which can be leveraged to gain public support and overcome challenges.
Regard company stock as a long-term investment rather than a speculative tool, as speculation by leadership can lead to ruin by creating a conflict between serving the company and the stock market.
When an industry relies on imprecise methods, invest in scientific principles and research (e.g., a laboratory) to transform craft into a more consistent and quality-controlled science.
Steer clear of price-fixing or royalty combinations, as they may not be good business and can limit your ability to innovate and compete on value.
Engage in extensive planning for all aspects of your business, but ensure your plans remain flexible enough to adapt to changing circumstances, as rigidity can be detrimental.
Understand that the true nature and reliability of a partner are best revealed during difficult times, so observe how they act when things are challenging.
Cultivate a clear understanding of when you are operating based on facts versus when you are guessing, to make more informed decisions.
Challenge long-standing industry beliefs and practices, especially if no one can explain their necessity, as they may be inefficient traditions rather than requirements.
During times of disruption or crisis, actively look for solutions to critical infrastructure or systemic problems, as these can create new markets and opportunities.
Instead of just selling a product, work to create entire ecosystems that complement and expand your market, benefiting both your company and the broader industry.
Recognize that during boom times, apparent success can mask fundamental inefficiencies and organizational bloat, leading to a false sense of brilliance.
Even during periods of peak business, anticipate and prepare for potential market slowdowns, rather than assuming indefinite growth.
During critical times, ensure your team is fully committed to the strategy; remove those who are half-hearted or cannot embrace the necessary drastic actions.
To recover from severe debt or crisis, apply relentless discipline to economies, sales, quality, and maintain an honest assessment of your position, avoiding self-deception.
Recognize that crises can be valuable for revealing what is truly necessary and important, stripping away impressive-looking but ultimately useless complexity.
Cultivate a mindset that finds joy in the worries, demands, tests, and challenges of business, viewing them as opportunities for growth and engagement.
Understand that a business requires continuous, active management and will not run itself, regardless of its success or your personal wealth.
Ensure your business remains profitable, as operating without profits, even for benevolent reasons, ultimately destroys its ability to provide service.
Embrace the human connection aspect of business, engaging directly with people rather than hiding behind memos or management layers, especially during crises.
Find supreme satisfaction in the process of planning, overcoming obstacles, and carrying through plans to a final accomplishment.
Recognize that ideas, determination, and persistence are more critical than capital or experience in business, as the latter can be acquired.
Be prepared to let go of employees who become complacent or underperform, especially if they are no longer driven to execute effectively.
Be wary of making quick decisions that lack thorough prior thought, as such decisions are exceedingly dangerous and often amount to mere guessing.
Develop a ‘perverse appreciation’ for discomfort and challenges, as thriving on them reveals your true character and helps you persevere when others quit.
Proactively position yourself at the intersection of major emerging trends and evolving needs, allowing you to ride the waves of transformation rather than being swept away.
Actively differentiate between working in your business (execution) and working on it (gaining perspective), dedicating time to the latter to foster strategic growth.
Strive for win-win outcomes in all relationships, as this is the only approach that builds lasting success and compounds over time.
Be open to and prioritize genuine opportunities, as successful business owners do, rather than being ’too busy’ for new ideas, which often characterizes struggling businesses.
Develop products with obvious utility that sell themselves, or invest in effective marketing to educate customers about their value if the benefits aren’t immediately apparent.
Cultivate a mindset that allows you to perceive opportunities even in situations that others view solely as crises or disasters.
Recognize that significant innovation can occur when you are forced outside existing systems or conventions, leading to superior alternatives that might not have otherwise existed.
Design and price your products to be accessible to average consumers, not just the wealthy, to achieve mass market appeal and impact.
Dedicate significant time and effort to refining products until they work properly, even if it means repeated failures over an extended period.
When a business is losing money, it’s crucial to understand the exact reasons why, and if you know why, ensure you can take action to remedy the situation.
Recognize that deep thought and strategic thinking are the real capital in business, more so than money, and invest in developing this capacity.
Aim to create something that will endure and grow in value beyond your immediate involvement, rather than focusing solely on short-term profits or boom years.
Exercise patience in negotiations, observing and gathering information before acting, and be willing to walk away if conditions aren’t favorable, letting the deal come to you.
Actively seek to maintain perspective on your business by reading voraciously and stepping back from daily operations, to avoid missing new developments and strategic opportunities.
Maintain your fundamental desire for independence and the drive to build something truly your own, even after achieving financial success, as wealth alone may not satisfy.