Mark Cuban, owner of the NBA’s Dallas Mavericks and star of the business-themed reality TV series Shark Tank, has always advocated for the importance of launching startups while you’re still young.
He made a fortune in the late 1990s when he and fellow Indiana University alumni Todd Wagner sold a co-venture called MicroSolutions to Yahoo for over $5 billion.
Since then, the versatile business magnate has dabbled with a variety of businesses both as owner and partner. As of the moment, he has interests in over 120 businesses.
In a recent interview, Cuban outlined his 12 unbreakable rules for business startups, and this article takes a closer look at the billionaire’s insights into new ventures.
1. Don’t start a company unless it’s an obsession and something you love.
It won’t matter how good your connections are or how large your operating budget is, nothing can replace a strong passion for your business idea.
Without this obsession for the business idea, your chances of failure can only get compounded.
2. If you have an exit strategy, it’s not an obsession.
Yes, it is advisable to have a plan for when things don’t go well but for a startup, obsessing over this only highlights a serious problem. Don’t let your survival instincts distort your ability to scale the company.
3. Hire people who you think will love working there.
It’s perfectly fine to build a team that incorporates a diverse set of backgrounds, but keep in mind that the majority of your perspectives should coalesce in order to have a functioning unit.
Look at it as a personality fit, and find a way to blend the people so that you have a workforce that promotes your company’s culture.
4. Sales cures all.
In an interview with Business Insider, Cuban told of a lesson he had learned in his 30s: that any business, regardless of any existing issues, can be made to scale provided they’ve developed an audience.
So, whatever the nature of your business, you can be successful if you can generate sales.
5. Know your core competencies and focus on being great at them.
Find people who bring unique talents to your business and spend liberally to get them to join your company. Outside of this, hire people who are good at what they do but keep costs manageable.
6. Lunch is a chance to get out of the office and talk.
Large companies can afford to provide expensive perks such as food, a gym, therapists, etc., but your startup can’t compete with that.
Instead, offer your workers some drinks and maybe a few snacks and keep them busy working on building the company.
7. No offices for startups.
An open-office layout is ideal for new businesses as it helps keep everyone in tune with the agenda and you’ll find it easier to keep the energy up.
8. As far as technology, go with what you know.
Technology shouldn’t be a major issue when you’re starting out. In any case, your priorities don’t include running complex software or operating systems or purchasing expensive hardware for your workers.
Keep things simple and focus on products that have immediate value and help you establish the business.
9. Keep your organization flat.
Startups don’t need a complicated hierarchy of managers or other systems that hinder the normal flow of business and takes a fortune to organize.
A new company works better when workers have clearly-defined roles and are comfortable communicating with the owner.
10. Never buy swag.
It is fine to create T-shirts and other items with your company name or logo, but these items will only be used by your team, at least in the early stages.
The chances of selling T-shirts and caps to a multitude of fans is extremely low based on the fact that only a few people know about your business. This isn’t a smart way of spending cash.
11. Never hire a PR team.
Cuban has always been cynical about PR teams particularly in regards to startups. Going by his argument, the role of a PR firm can easily be duplicated by setting up a communication strategy with the people in the publications you read.
This, according to him, can be sidestepped by saving contact information such as email from popular publications and then sending a message to introduce yourself to the company.
Keep in mind that it’s their job to find new business ventures that have a story, and if you can present an interesting background, then you’ll get their attention.
In addition, most of these publications will appreciate talking to the business owner as opposed to some casual PR rep. Once you start communicating with them, make yourself available to answer any additional questions and work as an inside source for them.
12. Make the job fun for employees.
Cuban has a reputation for humor and keeping things light, and he takes this attitude into his businesses.
Back when he and fellow partner Wagner still owned MicroSolutions, Cuban would hand out $100 bills to employees when they broke records, and he also established a ritual that involved taking his workers to Kamikaze for shots.
To make these 12 rules for startups easier to remember, take a look at the following infographic.
Cuban has three more advice for young entrepreneurs: start today, don’t worry about making mistakes, and set goals.
All these tips, however, can apply to any small business owner, regardless of age. So whatever the business you’re thinking of starting is, whether it’s web designing or selling sports items online, start it today.