May 16, 2011
The recent worldwide economic slowdown, plus some spectacular business failures and criminal scams, have made investors cautious. But every day, entrepreneurs still come up with new ideas that get funded, often with an infusion of money from speculative investors called "venture capitalists."
Studies show that two-thirds of new businesses fail and disappear within 10 years. Yet there are countless stories of entrepreneurs who have come back from bankruptcy or worse, reinvented themselves, and reaped millions of dollars. For instance, New York tycoon Donald Trump, who's rumored to be considering a run for president next year, lost a fortune in the casino business and made it back and more in real estate.
In a new book, called "How They Did It," Robert Jordan - who himself has launched and grown several companies - interviews 45 other successful company founders to learn their secrets of success.
All of them share one trait, Jordan says. It's resilience. "These entrepreneurs all faced at least one crisis that should have stopped them in their tracks," he writes. "Instead, they bounced back stronger, smarter, leaner, and meaner than before."
How? Here are four tips from the book:
Don't be embarrassed to hire people better than yourself.
Hire people who are nice, not just smart. "If you hire people who are smart but jerks," one founder, Ronald Galowich, told Jordan, "they'll just hire more smart jerks."
Make your employees shareholders, Biomet executive Dane Miller suggests. "Give stock options to everyone at your company - all the way to the janitor. When employees have a sense of ownership, it creates a kind of self-enforcement process."
When all else fails, just start over. "What doesn't work, throw away," Jordan writes. "And what does work, run with it."