As an entrepreneur, you’re going to make mistakes and, just like in school, that’s okay, as long as you learn from them and you don’t give up. Believe it or not, even some of the world’s most successful entrepreneurs have experienced failure, but they always learn from those failures. That said, do you think if after knowing what they do now, these entrepreneurs would work to avoid those failures? You bet they would! No one wants to experience failure if they can help it.
If you can learn from others’ mistakes, failures, and successes, you’ll be ahead of the game and headed for success.
DAYMOND’S LESSON—YOU CAN’T JUST THROW MONEY AT IT
Let’s start with a hard lesson Daymond had to learn that cost him $6 million. He partnered with a couple of great guys who were also brilliant fashion designers. He loved their brand idea, and thought it had the potential to really take off. What he didn’t know was that these guys were not great brand managers and that they didn’t have a designer business model to go along with their designer women’s clothes.
He thought that he could throw money and resources at a problem that could only be fixed with proper management and marketing. In doing so, he forgot what had made FUBU successful—that he was broke when he started it. When every dollar counts, you use every dollar wisely. When you have a few million to throw around, it’s easy to forget that every dollar still counts. He learned a lot from that very expensive mistake, and so can you.
DON’T TAKE MONEY FROM JUST ANYBODY
Patrick Whaley made an interesting decision when he appeared on Shark Tank and chose to partner with Daymond for a $500,000 deal for 20% equity in his athletic compression clothing company. On the surface, it looked like he might have had a better deal if he’d gone with Kevin’s offer to pay the same price for just 15% equity, and a lot of entrepreneurs would have taken that deal.
So why did Patrick choose Daymond’s offer instead? Because he’d done his research on his potential investors, that’s why. He knew that though Kevin was giving him a better offer on paper, Daymond had a lot more expertise and advice to bring to the table in the fashion industry. Researching your investors and knowing who to accept a deal with is a huge part of building and scaling a successful business.
YOUR PERSONAL BRAND MATTERS AS MUCH AS YOUR COMPANY BRAND
You need to make sure that your personal brand fits with your company’s brand. How do you think Daymond first sold his hats and shirts to hip-hop artists and fans? At the time, if he’d been in a business suit trying to sell clothes to those kids, they would’ve laughed him out of the room. His personal brand was closely tied to the neighborhood where he grew up and the music he listened to. Those things made him credible and believable. They made people see his brand as an extension of himself, and they saw him as an extension of their shared culture. In the beginning, his personal brand sold as many shirts and hats as FUBU did.
Your approach to money matters. Your relationships with your investors matter. Your personal brand matters. All of these things are lessons that other entrepreneurs have learned before you and that you can use to build your brand into a successful business. You’ll still make your own mistakes, but you won’t make nearly as many of them as those who came before you.
Originally Published: November 2, 2015