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Bill Gates’ Entrepreneurship Advice

“Most people overestimate what they can do in one year and underestimate what they can do in ten years.”

Bill Gates Quotes on Entrepreneurship

Bill Gates got it just right … there are two pieces of bootstrap advice I learned in my first years in business.

“Most people overestimate what they can do in one year…”

One of these lessons came my way in a folksy aphorism:  “you get the first year for free.”  That’s a catchy way of saying that when we’re new in business, people… all kinds of people… tend to make allowances.  They know that we’re struggling, we don’t know everything, and every morning we seem to wake up to a new learning curve.

Our first mistake can be easily fixed with a redo, accompanied by a heartfelt apology.  And a commitment not to make the same mistake twice.  That means it takes us three times as  long to do whatever it is we’re doing.  First, we don’t do it quite right.  Then we have to make the apology and do it over again.  After that we have to figure out how not to make that mistake again.  That’s a lot of time.  Maybe that’s why I don’t wholeheartedly subscribe to the advice-du-jour about failing fast and failing often.  Failing can be a lot of work.  We get some sleep if we’re less enthusiastic about failing.

“… and underestimate what they can do in ten years.”

The other lesson came from my own hard experience.  Accomplishment feeds accomplishment.  Tom Peters’, in his book “Good to Great” describes it as spinning up the flywheel.  Flywheels start rotating very slowly at first, but if we keep adding effort they spin faster and faster.  One sale leads to two, that leads to three, that leads to five… and so on.   One quarter’s profits lead to two quarters, to a year-end profit… and so on.  The first year’s retained profits put some cash into the business that finances the next year’s expansion that leads to higher sales and more profits that leads to…. you get the idea.  Now, I always look to build some sort of momentum when I  accomplish something.  The next accomplishment might be easier or bigger, as long as I keep feeding in the effort.

So, when bootstrapping your business startup…

I don’t mean to suggest that we can’t start spinning up the flywheel in our first year, or that we’ll never have to apologize in our second year.  But my experience tells me that Bill Gates is right… dial back your initial expectations of cash and emphasize learning, and then work hard to spin that flywheel just a little bit faster every day, starting on day 366.  If we’re one of the 25% of business startups that make it past 3 years, we can surprise ourselves with our accomplishments.

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One Comment

  1. JAMES OJUOK says:

    Failing fast and failing often does not sound but it is something most of us deal with each time we undertake tasks. Learning not to fail sounds awesome, apologizing over our failures and having to do it all over again sounds exhausting. Good read.

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