Redefining What It Takes For Your Small Business to Succeed

Nov 13, 2013 -

Highlights and Commentary on Rework by Founders of 37signals

As a founder of numerous businesses myself, I can vouch for the lessons spoken about in Rework by Jason Fried & David Hansson (founders of 37signals). 37signals provides web-based collaboration apps for small businesses. Together, David and Jason have created sites such as which provides real-time chat and file and code sharing for remote teams and a collaborative writing tool. Oh I should also mention the company created Ruby on Rails.

When you first mention start-up or starting a business to someone, most people think of Silicon Valley, overnight successes, or something that has been glorified by the media. I know this because that was what first came to my mind when I thought of starting a business years ago. My idea of starting an business was glorified. If you started your own business you would be your own boss. As your own boss you would get to do what you want, when you want, where you want, and everything you did was your own. What I didn't truly realize were the difficulties involved in starting your own business and the fact that the flip side is that you are also equally responsible for the losses. You have to take the bad with the good in its entirety.

If I had Rework before I decided to launch my previous businesses, I probably would have been better off. Here are some interesting tid-bits that would've been extremely helpful had I known about them when I decided to start a business. Having said that, I still think they are helpful for those who are currently running small businesses. The topic headings below are chapter titles in the book, but the paragraphs below are my own.

1) Learning from mistakes is overrated 

We often think that it is important to learn from our mistakes. My co-founder and I made a lot of mistakes, but those mistakes didn't tell us what we should be doing next. They only told us what we shouldn't do again. What might be equally important is learning from our successes. When we do that we can build upon what we already know to be successful and either do it better or more.

2) Planning is guessing

Who knows what will happen in two months, a year, or five years from now. How often do financial analyst's company earnings projections come spot on? Humans are notoriously terrible at predicting the future. So why bother with projections and business plans then? For they are more or less just educated guesses. While it is good to think about the future, just don't go overboard and set up a bunch of excel financial models or lengthy business plans. Decide on what you will do tomorrow or a week from now. You'll likely be changing your direction anyways.

3) Start at the epicenter

When you are running a small business or starting one, it's easy to get lost in the details. We might obsess with trying to put everything we want into the product/business. Start with what is absolutely crucial. For example, if you sell lemonade. Can you do without sugar? Yes, even though it might not be ideal. But, what is a lemonade business without lemonade?

4) Long lists don't get done

The longer something takes the less motivation we have for completing it. How much more difficult is it to finish something that takes five weeks versus an hours? Making long lists makes us prioritize and when we prioritize, we end up only doing what is most important and more often than not we leave the rest of the to-dos alone. This happened when my co-founder and I tried to launch a website. We ended up just doing 1 and 2 and leaving 3,4,5 on the list.

5) Marketing is not a department

The authors of Rework mentioned that marketing is a part of nearly everything that you do in the business. The way you answer e-mails and the way you present your product is all marketing.

6) The myth of the overnight sensation 

There is no shortcut or get rich scheme in starting a business. Also, don't believe for a second that spending money on a PR firm is the easy solution out of this. Who is going to write about a no-name company with a product nobody has heard about. Jason and David also mention that good PR costs upwards of $10,000. It would be a waste of capital to spend that when you are first starting out. There are plenty of companies who spent minimally on PR and became successful. Take for example Starbucks and Google in their early stages.

7) Reasons to quit

Have you started your business and are not sure if you should keep going with your idea? Are you deciding whether or not you should pivot and go a different direction with the business? Ask yourself these eight questions.
Why are you doing this?
What problem are you solving?
Is this actually useful?
Are you adding value?
Will this change behavior?
Is there an easier way?
What could you be doing instead?
Is it really worth it?

Here are some other chapter topics that I found interesting (in no particular order).

Test-drive employees
Take a deep breath
Send people home at 5
Scratch your own itch
Outside Money is Plan Z
Don't confuse enthusiasm with priority
Build an audience
How to say you're sorry
Hire managers of one
Own your bad news
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