Serial entrepreneurship is a term mostly associated with people who jump from one business to another. They sell (or “exit”) their successful companies, bankrupt their failed ventures, get bored with their partners, or change ships some other way. And as they move forward in life, they leave behind a trail of businesses they were involved with to some degree. There’s nothing wrong with that, as people learn from their mistakes, gain experience and probably even have fun along the way. The way they approach business is eclectic, their attention is fragmented, but ultimately they keep focused on one company (or at least line of business) at a time.
Another type of entrepreneur chooses to take it up a notch, and run multiple businesses at the same time. For some, their businesses are closely connected. For example, they start with a family farm, add a high-end restaurant on top and also open an organic produce store downtown. Such businesses form a coherent chain. The upside is that you have a lot of control over operations, and you are still kind of working in the same field. The downside? A set of interdependent businesses is more likely to collapse, much like a neat row of dominoes. Or, coming back to the Family Farm Incorporated example, one drought is enough to get you out of business for good.
To avoid that, safeguard against bankruptcy, and, let’s be honest here, keep up with their personal ambitions, many entrepreneurs choose to diversify their operations. With (hopefully, profitable) companies in different industries, you can make sure that your income is coming from different sources. It looks great on paper, but there is a lot of nuance lost when listening to accounts of successful business people on podcasts and reading their biographies.
In my business journey, I’ve spun off a couple of businesses from my main ones, sold off some, but usually had at least several running at the same time. Today, I’m simultaneously involved in Real Estate Development, Finance, and Cross-Border Trade. And I don’t think that’s the end of it, either. Here are some of the things that I’ve learned (sometimes, the easy, but usually the hard way).
You need to embrace imperfection
I deeply admire people that have chosen to be laser-focused on one thing and have perfected their craft or product to the maximum. From jewellers, whose signature technique is seen in every piece, to Apple, a company that has created some of the most iconic smart devices of the past 40 years. Yet, I have chosen not to chase perfection.
When working across several different business lines, you can’t be perfect. It’s something you will have to come to terms with. And being imperfect should not be confused with being inattentive or being sloppy. Being imperfect means that you try to understand the limits that you and others have.
Communication is more important than you think
If you thought that the whole “communication is key” and “honesty is the best policy” is useless folk wisdom, you’re dead wrong. Communication lies at the very heart of every business. And if we look at communication a bit more scientifically, we know that we always have signal and noise.
When you’re talking to someone directly, someone you trust and respect, noise is minimal. When you have tens, hundreds or thousands of people working for you, the initial signal will get distorted before it gets to you, just like in the kids’ game of “broken telephone”.
How to prevent it? I wish there were a magical HR routine that would make everyone honest in the way they report issues. Unfortunately, there isn’t. As a company director, you are most likely to receive information in condensed form from department heads and team leads. No matter the size of your business, you should have the ability to dig down to the source of information and talk to everyone, regardless of their position in the company.
Hiring a CEO might not solve anything.
“Eventually, you will want to step down, and hire someone to drive your business forward,” sounds like a solid piece of business advice. And it would be. In an ideal world.
I already wrote up some of my thoughts on the dilemmas of hiring, but hiring a CEO poses a whole different, even philosophical dilemma. Do you hire one at all?
Finding someone you can trust is hard as it is, and the ideal candidate you have in mind is probably already at the helm of their own business. And with a great candidate, there will always come a set of trade-offs. They might not get along with other key people in the company. They might want to bring their own team in. They might have a completely different vision. And, most obviously, they can simply bail on you. At the end of the day, they are a salaried employee that looks out for their best interests, not always yours.
For now, I have chosen not to hire CEOs for my companies. I tried looking for suitable people but haven’t found a person that I would deem fit for the job. Not the job of a CEO per se, mind you, but the job of a CEO running my enterprise. This, of course, might change in the future, so – “never say never”.
One thing that I’m certain of though is that it’s best not to experiment with other high-flying members of your teams. If you have, let’s say, a CBDO that’s great at what their doing (expansion in Central Europe, for example), promoting him to CEO, would mean that A) you have to find a replacement for someone who has been crushing it so far; B) you have a CEO that might have gaps in knowledge and experience that are needed to direct the company.
Running several companies is not for the faint of heart but ultimately it’s a rewarding experience. It makes you appreciate the little time you have even more. It also teaches you to be strategic with even the smallest of decisions. In the following weeks, I’ll be diving a bit deeper into the various areas I’m involved in (from trade to real estate) and sharing what I’ve learned or noticed. Stay tuned and thank you for reading!