Secrets of a Serial Entrepreneur

A Business Dragon's Guide to Success

Shaf Rasul, Shaf Rasul

• Publisher: Capstone
• Year: 2010
• Print ISBN: 9781907312519
• eBook ISBN: 9780857080950
• Edition: 1
• Topic: Business
• Subtopic: Entrepreneurship
• Index: Business

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

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.

Life in general, and business in particular, is all about people and once you’ve made your call then you have to believe in your people as much as you believe in yourself. A lot of entrepreneurs fail not because they have a bad idea, but because they’re not ready to trust others. You can only get so far without outside help. If you’re so attached...

Table of contents

• Title Page
• Copyright Page
• Introduction
• Chapter 1 - ARE YOU AN ENTREPRENEUR?
• Chapter 2 - EXIT - IT’S IN LARGE LETTERS AND LIT UP FOR A REASON
• Chapter 3 - BUY THE RIGHT BUSINESSES
• Chapter 4 - INVEST IN PEOPLE, NOT IN PRODUCTS
• Chapter 5 - START YOUR OWN BUSINESS
• Chapter 6 - TEN KEY THINGS TO KNOW ABOUT BUSINESS FINANCE
• Chapter 7 - MAKE A BUSINESS PROFITABLE FAST
• Chapter 8 - DRIVE A HARD BARGAIN
• Chapter 9 - SELL BUSINESSES FOR A PROFIT
• APPENDIX
• INDEX