Start a Business

Learn the basics of starting a new business in order to become a successful entrepreneur.

This article, by Gumroad founder Sahil Lavingia, should be studied with an open mind by anyone aspiring to scale a startup.

I thought Gumroad would become a billion-dollar company, with hundreds of employees. It would IPO, and I would work on it until I died. Something like that.
Needless to say, that didn’t happen.

Now, it may look like I am in an enviable position, running a profitable, growing, low-maintenance software business serving adoring customers. But for years, I considered myself a failure. At my lowest point, I had to lay off 75 percent of my company, including many of my best friends. I had failed.

Fear is a powerful motivator, and for many of us, fear of not reaching your goals can be outright depressing. It’s so easy to get lost in the ambition of building something so outrageously successful that you overlook the pleasures of what you’ve already created.

While Sahil learned a lot about how to run a business (and how not to) through this journey, I believe his most impactful change was in his own perspective of himself.

I think we’re all guilty of putting too much pressure on ourselves to be something. And while ambition is necessary, decisions should be made with present reality clearly in focus.

Now is the only part of life that matters. Don’t lose sight of how to add the highest value today because you are sweating what the future may hold. It’s easy to lose everything that way.

Thinking of your business as a game to be won is perhaps the most singularly damaging attitude you can have as an entrepreneur.

Games are a battlefront, with a winner and a loser. Which side do you want to be on? The winning side, of course… right? I would argue that this is an unhealthy thought process. This is a false paradigm which dramatically overcomplicates the reality of the business world.

Business is not about stealing customers, destroying competitors, or being bigger and larger than the companies around us. Wealth, power, size and influence are all byproducts of serving value to others.

Our purpose as business people should be to always seek to add the highest value to those whom we serve, without condition for ourselves. When our ego is present, we are lead astray by our fear, greed and insecurities. It’s only in the complete absence of our ego that true leadership exists.

Treating business as a game infects our thinking by putting the focus on winning or losing. But, win-win scenarios are the only paths to success. Any other situation perpetuates a downward spiral, despite the potential illusion of short term success.

What happens when you create a situation where your company thrives at the expense of your customers? If you don’t create enough value to sustain your involvement in the project, your customer can’t afford to pay you. As a result, they leave and you suffer the loss of a customer. A win-lose always becomes a lose-lose.

Lets flip the script. Consider a situation where you provided a service for a customer, but after the work is done they renegotiate the deal with you for a lower price. The work is no longer at a sustainable rate for you, and so you can’t serve that customer anymore. Without a vendor, the customers business will suffer. A lose-win always becomes a lose-lose.

Enter competition. If a customer can’t sustain you as a vendor, another vendor will avail themselves in your stead, right? That is, indeed, virtually always the case. But, that’s not a competitive loss. It’s merely your failure to serve by not finding a win-win, which gives your customer no choice but to look elsewhere. The company which provides the highest value becomes the vendor, by the nature of the way the world works.

Prolonged gains, like those required to create a profitable business, don’t come at the expense of others. Quite the contrary. We must live to serve each other in a spirit of oneness if we are to find mutual success.

Start a Business Books in my Library

Talking to Humans: Success starts with understanding your customers by: Giff Constable
Lean Analytics by: Alistair Croll
The Airbnb Story by: Leigh Gallagher
Will It Fly? by: Pay Flynn

More Start a Business Books