Here are six great nuggets of advice from billionaire Kevin O’ Leary of Shark Tank.
1. Forget the 9 to 5
If you’re hoping that you can just give entrepreneurship a little bit of effort in order to achieve great success, think again. O’Leary explains:
There is a discipline required as an entrepreneur about working to optimize the business. There is no balance in life as an entrepreneur. You can’t expect to work 9 to 5; that’s never going to happen. You have to expect that it’s going to consume your life for a period of time. That’s the downside, but the upside is that you buy yourself freedom in perpetuity.
2. Be willing to fire people
Sometimes employees or partners simply aren’t a fit. It’s the job of the entrepreneur to know when a business relationship should end. “You need to be willing to fire someone once they lose their direction with the business,” O’Leary says. “There is no debate on this one—you have to fire them. The first moment you think about firing someone, you should do it.”
On the other hand, O’Leary explains that entrepreneurs can’t let their businesses become wholly dependent on just one person. When someone tells him an employee is irreplaceable, O’Leary says he immediately fires that person. “I know that sounds cold, but it isn’t. It’s part of the Darwinian nature of business.”
3. Get your head out of the clouds
Entrepreneurs often set unrealistic financial goals for themselves, and this terrible habit can get them into serious trouble. Mr. Wonderful cautions entrepreneurs to be conservative about the targets they set and to only set targets they are totally committed to hitting. “There should be a consequence for not hitting the targets because poo-poo happens all the time—unforeseen events, changes in the market.”
4. Let’s be clear: You’re here to make money
Entrepreneurs can get sidetracked by feel-good missions with emotional benefits that go beyond profit. O’Leary warns that this can be the undoing of many great companies:
Get clear on what our goal is: I don’t invest to make friends. I invest to make money. If you want a friend, buy a dog. I want the people that work with me to become wealthy and successful. I’m not a kumbaya guy. I don’t need group hugs, I need performance.
O’Leary says to leave the emotional aspect out of business. “When the day is over, I go home to my friends and family and enjoy what they have to bring to the table.”
5. Your idea is either good or bad
Many entrepreneurs fight to keep a bad idea from dying. This is a tremendous waste, according to Mr. Wonderful, and he cites his fellow investor on the show, Barbara Corcoran, as an example. “She’s always encouraging bad ideas because she’s worried about someone’s feelings. That’s horrible, that is the worst thing you could do, and I chastise her all the time for that,” he says.
O’Leary posits that there are no gray areas—only black and white. He believes that ideas are either good or bad, “And when it’s a bad idea, I’m going to tell you.”
6. Do what you love to do
In a moment of total candor, O’Leary shares, “The whole reason to have gone through the journey I’ve gone [through] is that you want to get to a place in your life where you wake up in the morning and if you don’t want to answer the phone, you don’t have to; if you don’t want to do anything, you don’t have to.”
O’Leary says he wants to do things now that really interest him, and helping entrepreneurs get to where he is today is one of those interests.
The beauty about O’Leary’s advice is that it comes from a place of having been there. He truly walks the talk.
“To be a successful venture capitalist, you have to have started a business in the past,” he says. “You need to have gone through the utter terror of getting started. I try to get my entrepreneurs to not make the mistakes that I’ve made in the past.”