Michael: Hello everyone, and welcome to the HaBO Village podcast. Today we're going to talk about, how to recover from an entrepreneurial seizure. Well, welcome back everybody. I'm Michael Redman.
Kathryn: And I'm Kathryn Redman.
Michael: And this is the HaBO Village podcast, as we said before. And this podcast is dedicated to leaders in business that want to build passion and provision companies filled with profit, purpose, legacy, maybe legacy up to the fourth generation. I know we care about that and I'm talking about it more and more and more because it's important to me.
Kathryn: All right.
Michael: And today we're going to talk about this entrepreneurial seizure. I love this. Michael Gerber said it in one of his books about E-Myth. He wrote multiple revisions. He wrote the E-Myth Mastered, good books.
Kathryn: E-Myth Revisited.
Michael: Oh my goodness, [crosstalk 00:00:44] a lot of E-myths. And one of the things he talked about was there's a lot of businesses, a lot of leaders who start companies that they had an entrepreneurial seizure and that's what caused him to do it. And do you remember what an entrepreneurial seizure is?
Kathryn: Well, I don't know if I'm going to have the exact definition, but this is the way that I've always seen it. Is as the person who's sitting there working for someone and they're doing something and they all of a sudden go, I could do this for myself.
Michael: I could do this for myself.
Kathryn: And keep all the money.
Michael: Seizure, seizure, seizure.
Kathryn: I can actually do that. I don't need to be lining that guy's pockets. I could align my own pockets.
Michael: I could do the same thing I'm doing every day and I could keep all of the cash. All of that profit, it would be amazing. And then they walk in and they quit and then they go home and they tell their spouse and they go, guess what?
Kathryn: I quit my job today. We're going to start a company.
Michael: We're going to makes so much more money and it's going to be amazing. And it's going to be great. That's an entrepreneurial seizure. And today we're going to talk about how to survive that, because that is one of the reasons the business failure rate is somewhere around 80 to 90%. There are people who are saying it's 90%. This is failure rate. That's a lot of people who said, I'm quitting this and I'm going to go do this.
Kathryn: Well, and it matters this year too. Even if during a year where so many people have lost jobs and are feeling like they need to start something because they need to be the master of their own destiny, that may not be quite the seizure. It's more of a forced reality. But even so today's topic is really, really important for you if you are starting a company this year because of the turmoil that has happened.
Michael: That's a great point because entrepreneurial seizure in its classic sense is, I can make more money. I would get to keep all the profit. I'll do this on my own and it'll be great. The other thing that's happening that puts you in a similar situation is just like what you're saying, out of necessity I got to do something to survive. I got to do something to pay the bills.
Kathryn: You're being forced into something in some ways.
Michael: And so now's a great time. Why not do it now or whatever, but you still need to survive a entrepreneurial seizure. You need the same type of skillsets that you're going to need when it comes to starting a business because of you have to. You're in a necessity, I got to do something. And really what it is, is to survive an entrepreneurial seizure, you've got to understand, you've got to wake up from the seizure of, I can just run a business by just doing what I've been doing and realize that, that's working in the business. Doing that day to day, creating a product or service or whatever, but you have to work on the business too. And there are three critical things that you need to do to work on the business. Correct?
Kathryn: Yeah, I think actually there might be four.
Michael: Okay, let's talk about four today. I think that's okay.
Kathryn: So the first is you have to ask, do I really want to be in business for myself? When you wake up from that sudden, I did this, or I've had to do this, are you the type of person who really wants to be in business for yourself?
Michael: Well, and that's really key because if you have an entrepreneurial seizure, I think asking the question, do I want to, because you had this moment where it's like, Oh, I was so excited. It seemed like it was such a smart idea. I thought about it. But you realized, because we have a lot of people, like I wish I had thought about this more. They say that to us. I wish I'd thought about this more before I made the jump. I wish I'd known what you are telling me now. People tell us this in our consulting room, in our conference room. I wish I'd known this when I started. I wish I could have started our company this way with this kind of knowledge, it would have made life so much easier, so much smoother, so much better. We would have been more profitable faster and so on and so forth.
Kathryn: Well, and we've worked with multiple types of companies, but one of the things is even when somebody has been in a company for a very, very long time and they've been successful, we've seen those kinds of folks go and buy another company, thinking I know exactly what to do. I've been in business a really, really long time, but they weren't responsible for all of the moving parts of the business before. They were responsible for their part. And then they buy a company, even one that's already up and running and suddenly it's like, Oh wait, there's a whole lot of other pieces. Now I'm responsible for HR and I'm responsible for financial management and I'm responsible for the morale and the culture of this organization.
Michael: And casting a vision for the company of where we're going.
Kathryn: All of those things, it isn't just brand new entrepreneurs, but it's even people who buy companies thinking I know exactly what to do, but they've never actually been in the head honcho, head chair role before. And it's very different.
Michael: Absolutely. And so that first question is just before we even get into how to survive an entrepreneurial seizure, do you want to stay in that? Once you've come to your senses, if you're not cut out for the risk and the challenge and really taking this journey, just get out, get out now. There's no shame, there's no harm. We will not be looking down our nose at you. And it will be wise for some of you to just say no, I'm going to go back and find a job because this really is not as stressful and I'll tell you what, great employees come from people who tried to start their own thing and realized that they weren't cut out for it. It wasn't their personality. It wasn't what they wanted to commit to. They didn't want to commit that extra time and energy.
Michael: It was like, that wasn't really what I wanted to do. We've got some friends right now that left a company that they'd worked for, for 30 years. Had a family situation. And so they left the company. Bought another company, and now they're going through an opportunity where they may not have to anymore. They've been at it for three years. If they get a chance to move on, it's going to be fantastic for them. And they're going to be way happier because they'll get to do exactly what they do well in leadership, but they don't have to worry about all the other stuff of being the owners of the company and being responsible for that. So many challenges. And if 2020 has done nothing else, it's exposed the weaknesses, even more in the challenges, even more for running a company. So many of those pieces. We go into that. You say, okay yeah, actually, Michael and Kathryn, I want to be there. I want to start. I want to stay in. The first thing you need to do is you need to have a clear vision. That's the second thing. First thing, second thing.
Kathryn: Once you've decided I'm all in, then there's three things.
Michael: The first thing is you need a clear vision. That vision, we talk about this in the book and we talked about it on other podcasts, but we want that vision to really have two major pieces to it. Two halves to it. And really quick, what are those?
Kathryn: The first half is your core identity, which is made up of your core purpose and your core values.
Michael: And the other half?
Kathryn: The other half is your envisioned future, which is made up of your big, hairy, audacious goal and a detailed description of that goal.
Michael: We have who we are now, and we have where we're going. Talk to me about the who we are.
Kathryn: The cool part about the who we are is, when you're able to actually sit down and articulate and codify your value system, it really begins to give, I think we call it in the book riverbanks. Your core purpose and core values, they really give you the riverbanks in which you're running your company.
Michael: It allows your company to create so much more strength and power and velocity actually.
Kathryn: And so the values are really who are we as a company? If you're a solopreneur it's who am I? If I were to grow a company beyond just me and a couple of maybe outsourced vendors, how do I want to run that? Who am I?
Michael: Core ethics, core behaviors, core values. We call them the core values and they set up the, I stand for this and they also help you say, I stand against this. You can say, no, you're more equipped to say no to things that you need to say no to, that can come as good things but are distracting to your company.
Kathryn: When we talk about the core values, we're saying, what are the three to five things that matter so much to you that if you were not allowed to operate in that way in your business, you would rather walk away and keep doing business.
Michael: Absolutely. And then your core purpose allows you to stay on track. It is in a sentence, roughly, what is it that is our core thing that we're doing? For half a bubble out is, we help business leaders build passion and provision companies. That's our core purpose. All the different things in a holistic model, that deal with that Disney's to provide wholesome entertainment and help people have fun.
Kathryn: Make people happy.
Michael: Make people happy through wholesome entertainment. That more eloquently spoken. And some of them are 3M is about creating great innovations on a regular basis. There's these companies that it's like, what is it that you are about that's that core purpose? So that you can also say, this is who we are as a company. We can say yes and we can say no. There's opportunities that fit within that and there's opportunities that do not, and they'll take you away from accomplishing the next half. And that is getting closer to what's the big dream you have, and where's the destination your company's going over the next 10 to 20 years.
Kathryn: Because one of the things that can be true about entrepreneurs is they can sometimes lose focus.
Kathryn: They can be like, that was really fun for five minutes, now I want to do this other thing. It's one thing if you've made a company successful and you've created it and somebody else is now helping you run that and manage it, then start something else. But when you start having additional entrepreneurial seizures in the middle of the one you have not yet set in place.
Michael: That happens.
Kathryn: It's hard for entrepreneurs sometimes to keep moving forward when the newness wears off.
Michael: There's another thing that occurs when that's not happening and that is you get so busy with today's work, that you're right in line with your core values, you're right in line with your core purpose, things are cruising along and yet what you find yourself doing is how do I say this? You find yourself buried down in the weeds. You get stuck in the weeds of, I'm so busy taking care of the urgent and you get stuck in the tyranny of the urgent of today's work that you also can lose sight.
Michael: Especially if you don't have a clear articulated what we call BHAG or a big, hairy, audacious goal. This big vision of where you're going to go. You're a North star. If you don't have that, it's hard to pull yourself out of those weeds at times. And you can be really, really good at staying on task with your core values and your core purpose, but you can go in circles. And all of a sudden your company never, it doesn't keep growing. It's not achieving its potential. You're not achieving the dreams that you hoped for it. And all of a sudden, you wake up three years, five years, 10 years later, and you go, hey, I survived. I beat the failure rates. But what you have is a company that's, you've lost so much potential opportunity because you lost track of the vision of where you were going. And the settlers of the United States did that. So many of them wanted to go to the West Coast and they got so tired and they said, this is a great place. I'll just settle here.
Kathryn: Every time we say that I think of, so I used to work for a company where we sold software and we would demo software. We'd find different places to demonstrate the software. It was a payroll and HR software.
Michael: I don't know where we're going, this is interesting.
Kathryn: I know. I remember being on a plane and flying to a major airport and then getting on a little plane and flying to a little airport. I remember this particular trip vividly because I lost my luggage and it was a day and a half demo. And I ended up having to go in jeans and the t-shirt that I wore on the day before. Anyway, we ended up in this little tiny podunk town in the middle of Montana. And I remember looking around even as we were landing and it was a town of maybe 10, 15,000. And I'm looking around and I'm like, okay, there's mountains off in the distance. I'm in the middle of this flat, dry, there's barely any trees. It was like we landed in the desert. And I remember looking at my friend, at Dan, and going, Dan, is this just an example of where the settlers just said, I'm just fricking tired. I am unloading the wagon right here. I don't care if it's nowhere, I'm done. I'm not going anywhere else. I'm settling right here. It was just this bizarre little town. And I can't remember what it's called, but I was like, why did anyone build a city here? I don't understand.
Michael: I think the sailors are like that. If it wasn't in the middle of the ocean, they would have stopped right there and gotten out of the boat. But that would have caused them to die and join Davey's locker.
Kathryn: David Jones.
Michael: David Jones' locker.
Kathryn: Clear vision is the next thing.
Michael: Clear vision, the next one is having a model and we talk about this all the time. But the reality is, is if you're going to survive an entrepreneurial seizure, now you have your vision. You need a business model. You need a plan of attack, a checklist that's going to make sure that you're covering all the things that are important to work on the business.
Kathryn: So a business model essentially is what are all the different pieces and parts that you need to have in place to succeed in business? It's looking beyond what it is that you're good at and that you're comfortable in, which is a lot of entrepreneurs are like, I'm really good at making widgets. I'm a great widget maker, or even the example that Michael Gerber uses in E-Myth, he talks about the girl who's the baker, and she's really great at baking and making pies. But when it comes to actually running the finances and hiring people and managing all of the different pieces and parts of creating a system, how do I make it so that somebody else can make the same recipe that I make so that there's consistency? How do I create operations? So all of those pieces and parts are what makes up a business model.
Kathryn: We have a business model. It's not the only business model. There are good models out there. But what we're saying is you have to have a business model because you need something that is reminding you about the pieces and parts that you are not naturally drawn to. So ours is fairly straight forward where we talk about the vision as the part in the middle. We talk about leadership, which we're going to come back to in a minute. We talk about management and operations, so that's all your systems, your hiring, all of that stuff. Marketing and sales. Money, that's a really big one for entrepreneurs. How to actually understand the financial picture of your company. And then how to build culture.
Kathryn: That's our business model and we would say, you need to be looking at all of those pieces if you're going to be successful. And it doesn't mean you have to master all of them. None of us are going to be good at all of those things, but we need to have what we would call a minimum working competency so that we can hire people who know what they're doing in those areas. So that we're smart enough to interact with them and ask good questions. So that we have just a good working knowledge of those areas of business so that we can lead well. So a business model is really, really critical.
Michael: And if you either find one that you have already or use ours, jump in, look at it and then go from there. But no matter what, you need one, so we've provided one. We have one that has helped us build passion and provision companies, and some phenomenal things and fruit have come out of it. We enjoy these things. And being at this for 18 years in our current company and eight years in our other company, we figured out a few things and we can help you. If you're willing to listen, you will catch a few things from us. And we've written down a whole lot of stuff in our book because it's like a mini MBA. If you can get the book fulfilled, and we'll tell you at the end of the podcast, how to get that, but this book is really full of all these tips and tricks.
Kathryn: Well, and it really is a way for us to say, hey, here's the mistakes we made. Don't make these.
Michael: Don't make these, and here's the things that we did well.
Kathryn: So there's the things we've learned along the way. These are the ways we got derailed. These are the situations that we put ourselves in that could have been avoided had we known better. We want to be able to say, you know what, there are ways to do it. And this whole concept of having a very clear business model, so you can more quickly identify your holes. You can more quickly understand where your weaknesses are and what you need to shore up. That is really, really critical.
Michael: And learn from our mistakes and find the things that work. Okay, so that's a business model. That's number two. Number three is actually working on your leadership. And we talk about the fact that you have to continue to grow as an adult, a human being, but you have to grow as a leader. And you have to develop your inner game and your outer game, because whether you're a solopreneur and you're just going to be dealing with vendors and making sure that you're doing all the right things to grow a business, to work on your business, because you have to do a lot more as a solopreneur, you actually have to do more work at times than when you have a team, because you nobody else to give the work to. Now you're having to manage all these things and your competencies have to be higher.
Michael: If you have a team, you have to have enough competency. Your minimum competency can be lower because you need to have a working knowledge and you have to know how to interact with those people to get good quality and then hire good people, and then you can move on. But you need to be able to lead one way or another. And leadership really involves all these outside tasks and making sure they're being taken care of and your company's moving forward. And you have that vision. And all of those pieces of the business model are being paid attention to. And yet that's the outer part. The inner part is your own personal maturity and development. Because I think that for all of us as entrepreneurs, once we have that entrepreneurial seizure and we're waking up from our seizure and now we're in our own business, it is our inner game is the thing that derails us and sabotages us the most.
Kathryn: Absolutely. So some will call this inner game. They'll refer to it as mindset. They'll refer to it as your mental attitude. So the attitudes, the belief system that you have that shapes who you are and how you think and how you process it's been called your internal operating system. The things that the world view your grid. Whatever verbiage you want to use around what drives and motivates you.
Kathryn: And as you interact with your business, as you interact with people, as you interact with tasks, why do you act the way you do? Are you reactive? Are you just trying to protect yourself? Are you just like when things go wrong, you freak out attack people? Or are you somebody who is learning to master their inner world and becoming and intentionally growing so that when something arises, you're paying attention to, oh, this is how I feel. This is how I'm starting to want to react. Maybe I should go and breathe. And really paying attention to what triggers you. What are the things that would cause people who are working with you to go, I really didn't like that, or I really don't want to work with that person anymore?
Michael: It's funny. The thing that pops to mind is there are beliefs and one of the beliefs that just popped to mind is a sales belief that you have to have. And when people say, no, you have two choices. One is to think they actually said no and they mean, no. The other one is to assume that they mean not yet.
Kathryn: Yes. A good sales person has to have a, not yet mindset.
Michael: You really do. Well, and as a leader, when people say, no, one of the reasons we all say no is because we feel confused, we feel trapped. We feel like you want me to make a decision too fast.
Kathryn: I don't trust you yet.
Michael: I don't trust you yet, and all those things. And we've all seen, especially if you've been successful in business or sales or leadership and all, we've seen people who've said no, that eventually around. And it's not because they're being coerced, it's because they finally go, okay. Because sometimes no means I don't have enough information yet to make a decision, and you're asking me for a decision, or I don't trust you enough yet, or whatever. Go back and build rapport, go back and engage more, go back and don't rush through the process. Well, those sales lessons on no versus not yet are also true on leadership. When you're leading people and you're going, I have a belief that this should be happening.
Michael: Well, do I need to change my belief? Do I need to change the way I perceive this whole thing? Well, that didn't work, so it'll never work. Or failure's not okay in my world. I've always been taught failure's not okay. If you're waking up from an entrepreneurial seizure, get used to failure in the sense that it's got to be okay to make mistakes. If you're trying to make sure everything's perfect before you pull the trigger, you will never pull the trigger or you'll sometimes miss opportunities. And I know one story where a developer actually spent 10 years, I think developing a whole property development planned community. It was amazing and there was all this kind of stuff and they had the land and they went through the long process of getting it through the city, everything else. And then the great recession came and they had, I was told that they actually delayed over and over again.
Michael: And they had the plans. And then it was like, well, it's not quite perfect. And they went back to the drawing board and they tweaked this and this. If they had pulled the trigger 12 to 24 months before, earlier, and not mess with some of that stuff, they would have had the whole entire project. Now in 2020, that project would have been completely finished. And they would have been the ones that had it. But what happened was they lost the whole thing because they couldn't hold on financially to the whole project. And they lost it. That's a big deal. But even when you have lots of money in big projects and big things, you can still lose opportunities because of a belief you have, a structure you have. And that happens in little companies all the time. So we have those three things. If you decide when you wake up from an entrepreneurial seizure, you are going to stay an entrepreneur.
Kathryn: Congratulations. First of all, we're very proud of you.
Michael: We welcome you to the journey. We think it's amazing. It's awesome. Great, now I want you to survive. Kathryn wants you to survive. You need three core things. These are the three mistakes that people make, that they don't have these three things. They don't have a clear, concise and compelling vision. They don't have a business model to follow and to guide them. And they're not growing as leaders. They're not developing in their inner game and their outer game as leaders. So we want you to have that vision, the business model, and to be growing. And however you do it, we want you to do it. But we've included in our book, Fulfilled, a way to handle all of those things and some ideas on what to do to handle and address those things, so they don't become your achilles heel.
Kathryn: And also that you're doing this business in a way that leads to ultimately what we would call passion and provision. Where you are doing something you're gifted and skilled to do. You love it. You're excited about how it's going to change the world or how you're contributing, whatever that is. And then you also actually make money at it because it's so many, so many people believe it's one or the other. I either have to make money and lose my soul, or I can love what I do, but I'm never going to make money. And so we want to be able to say, no, we think actually that you were designed to do both.
Michael: And one of the ways to do that is to help other people get what they want. And in fact, it was said by a famous person and that famous person is Zig Ziglar.
Kathryn: Well, thank you.
Michael: He said it's going to come me.
Kathryn: Hey, famous person.
Michael: Zig Ziglar said, if you help enough people get what they want, they will help you get what you want. And this is this whole thing. We want you to be wise. We want you to be fruitful. We want you to not regret having that seizure and to move on. So today three things to survive an entrepreneurial seizure. And we just want to say, thank you for joining us. This is just take a moment to go, we really appreciate your listenership. We really appreciate what you're doing. And the fact that you are learning and growing and looking for places to learn. We want to be a place that encourages, gives hope, gives encouragement and gives practical steps and tips so that you can continue to build a company that has both the paradox of passion and provision. That you have a company that's successful and thriving and profitable, and it's fulfilling for you and everyone who works in it.
Kathryn: If you want to know more about that model and about how we've put this all together, you can go to fulfilledthebook.com, where you can get a copy of the book for $10, free shipping. It's half off on Amazon.
Michael: fulfilledthebook.com. and if you want to see the show notes for today's podcast or check out any of our other podcasts, you can catch us on any number of podcasts, setups, or go to habovillage.com and check out our show notes, ask us any questions. And we just want to say, thank you. I'm Michael Redman.
Kathryn: And I'm Kathryn Redman.
Michael: And we'll see you on the next show. Thank you.