Secrets of a Serial Entrepreneur E-Book

Shaf Rasul

• Herausgeber: John Wiley & Sons
• Kategorie: Fachliteratur
• Sprache: Englisch

Seitenzahl: 309

Veröffentlichungsjahr: 2010

Beschreibung

Lessons in business success from the newest Dragon in town

You no longer have to enter the Dragon' Den to get expert startup advice. In Secrets of a Serial Entrepreneur, Shaf Rasul distils his vast experience and knowledge into a practical business startup guide that takes you smoothly and successfully from idea to exit.

Are you in?

With tips and advice from Shaf, as well as examples and anecdotes from inside and outside the den, you'l discover exactly what it takes to be a successful entrepreneur. From starting up to buying and selling, from business plans to number crunching, Secrets of a Serial Entrepreneur shows you how to do it right first time. You'll fin out:

• If you've got what it takes to e an entrepreneur
• How to set up and manage a business with confidence
• How to make a business profitable – fast
• Ten key things to know about finance
• How to be quick on your feet and beat the rest
• How to hire and manage the right people
• When and how to exit – and how to spot your next opportunity

Who’s the Man?

Frequently featured in The Sunday Times Rich List, Shaf Rasul made his fortune in IT, property and asset management. In 2008 he was 19^th in a Management Today survey of the UK's top 100 entrepreneurs and is one of the UK's most successful entrepreneurs under the age of 40. He co-presents the BBC's Dragons' Den spin off, Dragon's Den Online, an internet and mainstream TV phenomenon.

"Shaf really knows his stuff – if you believe in your business, and want it to succeed, then read this book."
—Kavita Oberoi, Founder of Oberoi Consulting and star of Channel 4's The Secret Millionaire

"Seriously good advice for would-be entrepreneurs and those already in business, Shaf’s 'tricks of the trade' tell you to do things properly – and this book shows you how."
—Professor Sara Carter, head of Department, Hunter Centre for Entrepreneurship, Strathclyde Business School

"Shaf has never hidden behind tired old clichés or business jargon – he's a straight-talking tycoon who tells people openly and honestly how to become a success in the cut-throat business world."
—Matt Bendoris, The Scottish Sun

Leseprobe

Table of Contents

Title Page

Copyright Page

Introduction

Getting a head start

Anyone can do it

Chapter 1 - ARE YOU AN ENTREPRENEUR?

A breed apart

Chapter 2 - EXIT - IT’S IN LARGE LETTERS AND LIT UP FOR A REASON

Chapter 3 - BUY THE RIGHT BUSINESSES

Does the company fit?

Valuing start-up companies and small businesses that have been trading for a while

Valuing publicly quoted companies

Valuing a company that you are thinking of buying

Why give it away for a nice lunch?

Chapter 4 - INVEST IN PEOPLE, NOT IN PRODUCTS

Can you recognize the differences as a company evolves?

Outsourcing

Use recommendations

Social networking

Chapter 5 - START YOUR OWN BUSINESS

What is a great idea?

Product/markets

How do you get seed capital?

A private source, such as your parents, friends and family

A public source such as a business ‘angel’

Venture capital funds

What do you have to do to build your business?

Chapter 6 - TEN KEY THINGS TO KNOW ABOUT BUSINESS FINANCE

What’s in the finance top ten?

What break-even analysis can do for us

Keep people in your variable costs

The General Business Model

Going bust profitably

Chapter 7 - MAKE A BUSINESS PROFITABLE FAST

Sell the business immediately!

The quick fix

Chapter 8 - DRIVE A HARD BARGAIN

What homework is there to do?

Set your limits

Do you know what you want?

Do you know what you need?

Are you always ready to walk away?

Do you know the tricks of the trade?

Chapter 9 - SELL BUSINESSES FOR A PROFIT

Do you know why you’re selling?

Are you clear about what it is you’re selling?

Have you prepared the business for sale?

How do you ‘Do the Deal’?

APPENDIX

INDEX

This edition first published 2010

© 2010 Shaf Rasul

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Library of Congress Cataloguing-in-Publication Data is available.

ISBN 9781907312519

A catalogue record for this book is available from the British Library.

Set in 11/16pt Stone Informal ITC by Sparks (www.sparkspublishing.com)

INTRODUCTION

Being an entrepreneur means being in the risk business. You will make some mistakes, and pay for them, but in the end you are your own person and the successes you achieve make up for the difficulties you’ve met and overcome on the way.

Show me an entrepreneur who tells you they have never got it wrong and I’ll show you someone who has started to believe their own propaganda. Making mistakes and learning from them is an unavoidable part of the life of someone who is trying to make a lot of money out of setting up or buying and selling companies.

Here are two quick examples to illustrate my point.

I was once involved in a company that sold exhibition space to suppliers of products in the IT industry. It was doing well but very quickly went downhill when I made a simple mistake. I decided that expansion and growth would be best achieved by increasing the volume of people coming to the exhibitions. I thought that reducing the price of entry might help and took that strategy to its logical conclusion - we stopped asking people to pay anything at all to gain entry. The idea was that it would bring a lot more people into the exhibition hall. This, in turn, would bring more business to our customers, the exhibition stand holders, and we in turn could charge more for the stand space. What actually happened was that the numbers through the front door went up all right - up to ten times (particularly on a Sunday) but the people coming in were less interested in buying IT products. Some of them were simply coming in out of the rain and out of curiosity. That might not sound so bad but the genuine customers were fed up with pushing their way through the crowds and the exhibitors said that the extra people were wasting their time and, of course, stealing stock! It was a classic case of the laws of diminishing returns - and unexpected consequences.

What did I learn from that? That it’s not just customer footfall that makes a business successful, it’s attracting the people most likely to buy. Salespeople call it ‘qualifying the prospects’ and it’s a topic I will return to later.

It was probably a reasonable risk to take, but it sure didn’t come off. But it wasn’t a catastrophe; we could recover the goodwill of our customers and get back to business as it was before. So, a mistake and one I could learn from but not terminal.

Contrast this with another entrepreneur who made a mistake. He and his business partners were young men who knew a particular market very well. They were party people and they knew what attracted young people of their age into pubs and clubs. They decided to use that information to set up the sort of pub that they themselves liked to go to - loud music and low lighting.

So, they opened the doors of their new enterprise with a triumphant flourish and the party animals of the town came flooding in. Within a few weeks they had a packed venue and the cash was rolling into the tills. Everything was top quality with no expense spared. There were a lot of customers, so they needed a lot of expensive doormen. This kind of crowd didn’t want to wait long for a drink, so they had lots of bar staff. They had the top DJs, and regular parties both for the customers and also for the staff after work.

Unfortunately, the concepts of profit, loss and cash flow were passing them by. They did not understand profit margins - their strategy was to pitch prices at what people would pay, regardless of the cost of the drink. They took the money out of the till, and bought fast cars and houses they couldn’t really afford as well as the electronic toys of the day.

And, of course, it fell apart. In short, they spent the money in the till without realizing how much of it really belonged to them after costs and overheads. Because it was their business they confused the profits of the business with their own personal profits. The end of this story is bitter sweet. The bad news was that they shut up shop, gave the keys of the pub back to their lender and left a bunch of suppliers with unpaid bills. The good news was that they learnt from the experience, were not deterred by what had happened and started again. This time they knew the basics of business, they still understood the market they were aiming at and they went on to make a small fortune out of pubs and clubs. They are now seasoned entrepreneurs - all the more so because they know what it is to pick yourself up, dust yourself off and plunge straight back into the saloon fight.

In the first chapter of this book I will help you decide if you have what it takes to be an entrepreneur.

There’s a part of me that thinks anyone can be a successful risk-taking entrepreneur. It’s interesting that Duncan Bannatyne, one of the Dragons in the Den, wrote a book called Anyone Can Do It, and the founders of Coffee Republic, a successful chain of coffee bars and concessions (and nothing to do with Dragons’ Den), wrote their story and guess what they called it: Anyone Can Do It!

I had a conversation with a friend on the topic. He claimed that he could never be a millionaire because he wasn’t very good with money. Now, I personally believe that you don’t have to be a financial genius to make a million but on the other hand you do have to get the financial basics right, otherwise you run the risk of imitating the folk who started their own bar. I’ll be taking a look at what entrepreneurs are really made of in Chapter 1 and at the financial basics needed in Chapter 6.

Getting a head start

People who feel motivated or even compelled to set up their own business are quite likely to have been brought up in a family firm or in a family where at least one of the breadwinners ran their own business.

I was brought up in a family that owned and ran a newsagent’s ‘corner’ shop. I did my first paper round when I was ten and heard my parents talk about the good times and, more worryingly, the tough times that affect all business owners at some point or another. I learnt a lot from that experience; I may not have realized it at the time but profit, how much we could safely draw from the business, and cash flow, money received minus money spent over a given period of time, were concepts with which I was very familiar before I set up my first enterprise.

I learnt a lot from the family business:

• the basics of how money works

• knowing that working smart is as important as working hard

• that you shouldn’t over extend on borrowings

• to keep a tight control of the finances

• to keep your finger on the pulse all the time; if you look away something will go wrong

• the importance of knowing your customers.

Finally, the most important lesson I learned was that I knew I wanted to do something on a much bigger scale than the traditional family firm. I dared to go big.

So does that mean you have to have grown up with a family business in order to understand entrepreneurism? No of course not. I’m just saying it helps. It doesn’t matter if you grew up in a home where your parents worked in corporate companies or institutions - it doesn’t affect your ability to think like an entrepreneur. After all, many managers in large corporations demonstrate entrepreneurism and innovativeness on a daily basis. The first part of learning the basics of being an entrepreneur is being prepared to listen to other people. Perhaps most importantly, you should talk to people running small businesses so as to get a handle on the mindset of the person running their own thing. There’s no information or advice as fresh and useful as the opinions of someone whose livelihood depends on their daily business. It’s not hard to come by that kind of wisdom either; people who run their own businesses love talking about them. They will all give you some information that’s the same as everyone else, and some that is peculiar to what they are doing. So, the next time you go into a restaurant, and it’s quiet, ask the owner how their business is doing, what is going well and what, if anything, is worrying them. Do the same in your local IT shop; talk to social acquaintances and so on. You will be surprised how much real, practical information you can pick up.

Anyone can do it

As an entrepreneur, I believe I have the ability to think outside the box; spotting, for example, opportunities that others don’t. Perhaps, too, I take risks that no one else would even consider and I instinctively ‘get’ the benefit behind that basic business principle - the higher the risk, the higher the return. I also relish the sense of accomplishment and enjoy the financial rewards that come with success. Some people say that I was born to be a millionaire and in some ways this may be true. However, I believe that I was born to be an entrepreneur and along the way I made a few million.

How do I have the nerve to write this book? Well, to be fair to me, I only worked for a company for an hour and three-quarters. I knew after that time that it just wasn’t for me to sit at a desk and make money for other people.

Since then I have bought, started and sold businesses. I have made loads of mistakes along the way and I’ll tell you about them as well, so that you can learn the same lessons as I did. But I’ve also had some successes too: after all, I was a multi-millionaire before I was thirty. That’s partly why I have the nerve to write this book; I’ve got lots of experience. And then there’s the huge fun and privilege of being a Dragon in the Den. Through this I have looked at the many ideas of would-be entrepreneurs, some great, some not so great, looking for financial investment and a sounding board for their ideas from people who have been involved in small business start-ups. Passing on what I’ve learnt in the Den should also be helpful.

Helpful to you, I hope. You’ve bought or borrowed this book so I am making the assumption that either you want to start the process of becoming a successful entrepreneur or you’re already in business and want to add to the profitability of your current company. I hope after you have read the book that you will also want to sell your businesses, buy some others and make a lot of money. You can certainly learn some entrepreneurial skills; so I believe millionaires can be made as well as born. In my opinion a little bit of talent can go a very long way!

So, the key topics of this book are:

• buy the right businesses

• start your own business

• make a business profitable fast

• sell businesses for a profit.

Buy the right businesses: this involves analysing the position of a company quickly. It’s a mixture of gut feeling and good mathematics. Remember, buying companies is a competitive business - if it looks good to me, it’ll look good to other entrepreneurs or another Dragon, so you have to act fast. The analysis is not just the numbers, although I like to get to them as fast as possible, it’s also about the person with the idea; do they have what I call business nous and can I trust them?

Start your own business: when people come to the Dragons’ Den they’re not just after the money. They want a mentor. A lot of what I bring to a business now is not investment but my value as a sounding board for getting ideas off the ground. Like many entrepreneurs I also help people get their businesses going even when I’m not an investor. I’m interested in helping potential entrepreneurs and do a lot of charity work in this area, mentoring and encouraging young people.

Make a business profitable fast: look, we’re in a hurry, remember … We have invested money in a business and we want it back with a healthy profit as soon as possible. If it was unprofitable when you bought it, as many of my best success stories have been, then you need to know the tricks of the trade for turning it round into a profitable concern quickly. If it’s making money at the moment but not enough to attract a buyer then you need to work out how to increase your profitability - it can be done but the longer you leave it the less real return you’re making.

Sell businesses for a profit: it is not necessary to sell the whole business at first; it might have some assets in it that you want to maintain an interest in, or the buyer may want you to stay with the company for a while as part of the terms and conditions of the sale. Indeed, most entrepreneurs are good at sorting out shareholdings without damaging their position. Suppose, for example, you have someone in a company that you wholly own and they are running the part of the business located in the north-west region. Suppose next that they feel that their success in the north-west entitles them to expect some shares in the business they are helping to build. This may well be a sensible reward, but you don’t have to give them shares in the holding company. It might make more sense to create Newco Northwest and give them shares in that. (Investors tend to call companies that do not yet exist ‘Newcos’ until they have a name.) That could improve the profitability of the whole organization and lock the manager into the long-term strategy of the business. In this book we’ll look at how you find buyers and negotiate the best deal.

As much as anything else it’s about attitude and a willingness to have a go. It’s about overcoming that classic fear of failing - it’s somehow seen as being better to have never tried to make it than to have a go and fail. I’ll give you an example. I once suggested a wager with a friend: I was willing to bet that I could mentor him into achieving success. I was confident that I could make him a millionaire within 2 years. My friend politely declined the offer and dinner conversation progressed to a different topic. Interestingly, I was happy to take the chance that he would make it but he was not happy to take the chance that he might not. I firmly believe that you don’t have to be a financial genius to make a million.

I have written the chapter about buying businesses before the one about starting your own business. I have done this for two main reasons. First of all, the intention of an entrepreneur is to build businesses and then sell on all or parts of them to release money to build other businesses or, of course, to retire to sunnier climes. It makes sense, therefore, to think first about what someone buying a business is looking for - how they will value the assets of a company to weigh up how they could make more money out of them. The second reason is that I want to emphasize that the real fun and profit in being an entrepreneur is to be continuously looking for new opportunities to buy into, put into order and then sell. So I will talk about running and growing businesses and show you the skills you need to do that, but always against the background of buying, selling and moving on.

I firmly believe that you don’t have to be a financial genius to make a million.

Features of the book

There are three basic devices I’ll be using throughout the book:

Tip from Shaf - Tricks of the Trade

These are tried-and-tested tools and techniques covering a wide range of topics that I have found really work.

FAQ - Frequently Asked Questions

These are questions that I am often asked by my employees, by my business partners and by the people that I mentor and help with their businesses. There are questions too from people who just come up to me in the street with a query about their company, or something that has cropped up in the Dragons’ Den.

I tried it and …

“These are comments from people who have taken my advice or tried out a trick of the trade. They often give me feedback on how things went, so I think it’s useful to pass their experience on too. I have not attributed them to a particular person because they are often an amalgam of things that people have said to me over the years.”

Tip from Shaf - Think Outside the Box

Take a simple business decision that you have to make. Perhaps you could try writing your company’s vision or your team’s slogan as a simple example. Think of what comes immediately to you and then reject that thought; everyone will think of that. Now find an alternative. It will be better and only a few people will think of it. Now reject that and rack your brains to think of a third approach. Now you’re thinking outside the box and coming up with an idea or a decision that is unique to you. You can do this for all forward planning or strategic decisions.

Now, let’s find out if you are an entrepreneur …

1

ARE YOU AN ENTREPRENEUR?

Well, are you? There’s a harsh school of thought that says ‘If you’re not in business for yourself already then you’re not an entrepreneur.’ While it’s true that most of the entrepreneurs I know are pretty driven people, many of them did go through an apprenticeship with a big company, learning about business, finance and management, before taking off on their own. So, let’s say it’s never too late.

It is worth a bit of time to think about what an entrepreneur is and does and to take a close look at yourself before you take the plunge. By the time you’ve read this chapter you should have a pretty good idea if you are indeed already an entrepreneur or, perhaps more importantly, if you can become one.

Millions of people want to make a million but that doesn’t make them entrepreneurs. Thousands of people have an idea for a business, but that doesn’t make them entrepreneurs. Hundreds have entirely original ideas with great potential, but that doesn’t make them entrepreneurs either. So before you answer the question at the top of this chapter, let’s talk a little about just what is - and what isn’t - an entrepreneur.

I remember in Dragons’ Den when we had a chap called Alex with a product he’d invented called the Ladder Buddy and I asked him if he would say he was an entrepreneur. His reply was that ‘if creating things and changing things and enjoying changing things is being an entrepreneur, then that’s me.’ I stopped him and said, ‘No, that’s an inventor, you’re not an entrepreneur.’

Alex had come up with a good idea, he’d done a bit of market research (a subject I’ll come back to with a vengeance) and he’d found a gap in the market - but he was not an entrepreneur. He wanted to own the product - it was his ‘baby’ - and he wanted to make it himself, despite not being from a manufacturing background. I told him that if I were he I would just have licensed the product for someone else to make and sell, but he didn’t want to do that. Despite saying this, I still liked his idea and offered him the money he was looking for … but only in return for 70% of the equity of his company. I also told him that the product would be marketed on my terms and my terms only. To his credit, Alex swallowed hard but he accepted the deal - as he admitted himself afterwards he had had a go and taken the idea as far as he could. He was stuck and unable to go further. To get to the next level he needed someone like me. I’m not in the business of making DIY products. I’m in the business of making money. Alex recognized that. Most people don’t. Most people can’t distinguish entrepreneurial nous from standard good business sense, or having great ideas. This is not to say there’s anything wrong with inventiveness or good business sense, just that they are not to be confused with the attitude and aptitudes required to be an entrepreneur. Don’t think that just because you’ve got an idea you’re an entrepreneur, because if you confuse your creativity with the ability to make money out of it then you’re likely to waste your chances or end up making someone else rich. Assess your strengths, assess your weaknesses, realize where you need help and you’re already halfway there.

FAQ - Can’t an Accountant Do It?

Q:Surely I can buy in the knowledge that I lack to run a business? After all, everyone uses accountants to run the financial side of the business.

A: Only up to a point. Accountants are very good at telling you how you have done in the past. But you can’t wait for their 6-monthly reports, which are a month old before you get them, to run your business successfully. That’s like driving a car by looking in the rear-view mirror.

A breed apart

There’s no doubt about it, entrepreneurs stand out from other people.

I used to be a student at Strathclyde University and, like so many before me, I looked around for a job as soon as I graduated and found one in a legal firm. I worked there for literally two hours before I decided that it wasn’t for me. No, I tell a lie, it was probably more like one hour forty-five minutes. I found it difficult to accept - I had people bossing me about and I thought to myself, ‘No, it’s not going to be like that - I’m going to be my own man owning any business I work in’.

Nothing too unusual about that: there are other people who don’t enjoy their jobs much. Lots of people also love their jobs and the security of working for an established company. Not so many of those who dislike what they are doing decide to do something about it and walk out the door.

Within two days I had my own company. It was nothing to do with law either. I had a conversation with a man on a train who talked about his work in an IT department and I thought, that’s an interesting business sector, one which is obviously growing and where demand is outstripping supply. So I started an IT business.

Tip from Shaf - Time the Plunge

I’m pretty convinced that the best time to go it alone is when you are young. At this stage the only person you can really damage is yourself. It’s much more difficult to take the risk of setting up your own business when you have a spouse and a couple of kids than when you’re fresh out of school or college. You may find there is a period in your life, say the time when you have young children, that you have to live through before the window of opportunity opens again.

Looking back on how I started, there are a few lessons to be learnt. Hating my job didn’t make me an entrepreneur. If that was all it took then many more of us would be entrepreneurial millionaires! Walking out of my job didn’t make me an entrepreneur either, but having the will to walk was part of the process. Finally, starting up my own company was the clear turning point. To get there you don’t have to be me, you don’t have to look like me and you don’t have to sound like me. You might not even have to walk out of that job (not just yet anyway) but you’d better have the ability to make it happen, to actually DO something. So when you ask yourself if you’re an entrepreneur, don’t ask if you have the hunger to succeed, or a good idea, or even better than average business sense.

All of those are needed, but you’ll also need a healthy helping of the following.

Do you have the strength of character to stand out?

Lady luck smiles on ordinary people all the time, right? Wrong. We all wish it were true, and we want it to happen so much that we throw our money away on the lottery hoping it will be us. The only real winner in a lottery is the organizer and beneficiary charities. Entrepreneurs don’t trust to luck - they make it happen. To make it big you have to be ready to take the lead and push things through regardless of whether that suits other people or not.

Entrepreneurs don’t trust to luck - they make it happen.

There’s a popular stereotype of the entrepreneur as a hard-nosed, ruthless, grumpy sort of person. That’s not entirely true! You don’t have to be rude to be an entrepreneur, but if your first concern is what others will think or whether people will like you or not, then you’re going to struggle to drive your own agenda. Just look at the name Dragons’ Den. I have a reputation for being hard on people on the show, but I’m not out to be rude to anyone. I just weigh the pros and cons of their business proposition and make my judgement. The ‘rudeness’ that some perceive is because I don’t worry about what people want to hear when I give them my verdict, I tell them how I really see it. If you can’t do that, or learn to do it, then you’ll never really be running your own show, on your own terms and to your own advantage.

Tip from Shaf - Don’t Hobble Talent

You will need strength of character to really lead your business and your team. Remember, however, when you and your team are in planning mode, or when you are having meetings about the way ahead or having ‘away-days’ to really look at forward planning, that you make sure you encourage everyone to contribute their ideas. Always give your team the courtesy of thinking about their ideas and discussing them fully. An entrepreneur doesn’t have to be a perfect diplomat, or even much of a democrat, but you should always listen to what the people around you have to say. Surrounding yourself with the right partners is one of the skills you’re going to cultivate and having selected good partners you’d be a fool not to listen to them. If the team starts to think that it doesn’t matter what they suggest, that you already decided the plan before the session starts, then you will hobble their thinking, make them keep potentially good ideas to themselves and so feel frustrated.

Yes, in the end it’s your call; but if you don’t consult and never go with someone else’s idea then you will end up with a team of ‘yes men’ whose talent you will never truly tap.

Do you have the self-belief?

Not a shadow of doubt about this one. You have to believe in yourself all the way or nobody else will believe in you either. This goes naturally hand-in-hand with showing strength of character but it’s worth pointing out separately because some people believe that by acting like Sir Alan Sugar with a hangover they will automatically become more entrepreneurial. It’s not about having ‘attitude’, it’s about having a rock-solid faith in your own abilities, your game plan and your figures. Yes, your game plan and your figures.

There are a lot of successful entrepreneurs with strong characters and it’s tempting to get the impression that they got there by force of character alone. But if self-belief is the hallmark of successful people there’s a difference between blind self-belief, and unshakeable self-belief based on the confidence that you’ve done your homework, run your figures, re-run them, and come to the conclusion that you are on to a winner. It’s the difference between someone who thinks they’re Napoleon because they’ve just put on the funny hat, and someone who thinks they’re Napoleon because outside the door there’s a 65,000 man Grande Armée ready to do their bidding. Be sure of yourself by all means, but be sure because you’ve got the insight, the strategy and the resources, not just because the face in the mirror tells you you’re wonderful.

Tip from Shaf - Believe in Yourself, But Get Help from Others

When you are running your own organization you need to stay focused on the big picture of where the business is going, but you also have to keep an eye on the detail. Make sure you have enough knowledge and the courage of your convictions to use, and where necessary, challenge professional and technical advisers. Yes, it means that you have to get down to the nitty gritty from time to time. Anything you learn from accountants or bankers about finance, for example, may be crucial to some later decisions that you make. My message is - don’t accept at face value professional advice that gives you a sneaking concern that it is inconsistent with how you want to work. Go over it carefully, get the advisers to explain anything you do not understand and then make your own decision.

Do you believe in your product?

Just believing in yourself is all very well but it really is just the starting point. The next step is to come up with a business idea that you genuinely believe is excellent. If you have doubts about it then others will have doubts too and that may be enough to stall the whole thing. Many of the best entrepreneurial ideas come from people who recognize that they are their own target market. Knowing just why a consumer or client wants the service is a brilliant starting point and will give you the assurance needed to convince others.

Even that is only the first step, however. Truly understanding the worth of your product is a great base to work from but you also need to ensure that other people share your needs or tastes. If you’ve got the belief in the product, the conviction that there is a market out there, then the rest is a matter of juggling the figures and working out your route to market.

Now let’s go back to Alex and his Ladder Buddy again. He understood the product because he realized that it was something he himself would use. He had also looked around the UK and seen that he is not the only bloke with a DIY habit. He’d even looked further afield and seen that if it could work in the UK then it could perhaps make that leap across the Atlantic and in the process make him a very rich man indeed. Yet at that point he got stuck. Why? Because his instinct was to keep the whole project for himself. His self-belief had got him just so far yet he couldn’t quite take it to the next level. He had run into the wall of his own limitations and he and his Ladder Buddy couldn’t get over it without help. Which brings us to the next crucial belief …

Do you believe in others?

Alex didn’t think of licensing his product because like so many people with a ‘brainchild’ that is very dear to them, they can’t bear to hand it over to the care of someone else.

However, to be really successful you can’t just do it on your own. True, there are plenty of successful characters who like to give the impression that they made it to the top without the benefit of any help, but there are very few businesses which manage to be one man industries and hugely successful as well. Even world-beating novelists usually acknowledge the debt they owe to a team of editors and publishers. If you’re hoping to make an impact in any area of manufacturing or service provision then you’re going to need other people, and for that you need to be a good judge of character.