If you own your own business, you know that sometimes it can be difficult to deal with all of the challenges that arise.  That’s why it’s often helpful to turn to the experts—many times they’ve been there themselves and can offer guidance on how to achieve success while minimizing pitfalls along the way.  To that end, we have 5 book recommendations that are especially helpful for entrepreneurs:

1. The Lean Startup: How Today’s Entrepreneurs Use Continuous Innovation to Create Radically Successful Businesses by Eric Ries – Currently the #1 bestseller in Amazon’s Entrepreneur category, this book offers a methodology for creating a successful startup and offers plenty of real-life, interesting examples.

2. The Four-Hour Workweek by Timothy Ferriss – This book is a great inspirational read and while a 4-hour workweek is probably a stretch for most of us, Ferriss includes some great ideas for automating work flow, outsourcing, and managing time more efficiently.

3. The Innovator’s Dilemma by Clayton M. Christensen – This book is a favorite of Jeff Bezos, Amazon founder and CEO, as well as many other startup founders.  It identifies the reason why companies that seemingly do everything right become ‘dinosaurs,’ and it offers guidance on how other companies can avoid similar fates.

4. How to Win Friends and Influence People by Dale Carnegie – Although this bestselling book’s target audience isn’t entrepreneurs, it’s still a useful read.  The book offers various techniques for handling other people which is useful for entrepreneurs trying to generate sales, manage employees, deal with suppliers, etc.  First published in 1937, this book has gone on to sell over 15 million copies and even today, it is the number 1 bestselling book in Amazon’s Business Leadership category.

5. Thinkertoys: A Handbook of Creative-Thinking Techniques by Michael Michalko – The ability to deal creatively with problems, as well as develop innovative ideas, is important for any entrepreneur.  This book will guide you to think more creatively by teaching you how to approach problems in unconventional ways. 

For some startups, traditional marketing may not be what the company needs.  Instead, the organization may do better off by more narrowly focusing on growth.  In fact, it was that notion that caused the term ‘growth hacking’ to be developed.  According to the Definitive Guide to Growth Hacking, the phrase refers to finding “ingenious, technology-based avenues for growth that sometimes push the bounds of what is expected or advised.”

To illustrate the concept further, here are 5 examples of how companies have used growth hacking to achieve success:

1. Instagram – Instagram made a wise decision by allowing users to post photos to Twitter, Facebook, Tumblr, and other platforms.  This cross-platform sharing helped the company fuel its growth early on.

2. Hotmail – Almost amazingly, Hotmail grew its subscriber base from zero to 12 million users in just 18 months.  The company did so by placing a link in every outgoing email, encouraging the recipient to sign up for a Hotmail email account.

3. Airbnb – You might think that a website focusing on short-term rentals would get lost in the crowd with all of the lodging websites available online.  However, Airbnb attracted millions of new users by designing a website that allows Airbnb users to post their ads easily to Craigslist.

4. Pinterest – Although Pinterest uses a number of growth hacks, the one that you might be most familiar with is the infinite scroll.  When a user tries to scroll to the bottom of the page in Pinterest, the site keeps loading new images so the bottom is never actually reached.  This creates flow, making it more likely that users will spend extra time on the website.

5. PayPal – Of course you’re familiar with PayPal today, but you may not have been were it not for its successful growth hack.  To get more users, the company teamed up with eBay, inking out a deal where eBay allowed users to pay for goods and services with PayPal.  

If you’re looking to set the world on fire with your next business idea, we want to warn you about some common entrepreneurial mistakes.  While avoiding these issues won’t guarantee business success, they will make it that much more likely that your idea takes off:

1. Not Having a Website

In this day and age, it’s imperative that businesses have professional, well-designed websites.  Most consumers and businesses will research companies online before doing business with them which makes a good website all the more critical.  Additionally, there’s a strong likelihood that your competition will have websites, and you’ll be at a competitive disadvantage if you fail to develop a website of your own.

2. Choosing a Poor Location

There’s a reason that the phrase, “Location, location, location” is so popular.  Quite simply, the location of your business will have a big impact on your business’ success.  For example, say that you’re a retailer of luxury bath products like high-end soap, expensive bubble bath, etc.  Does it make sense to open your business in an economically depressed community with little available parking?  When choosing where to open your business, don’t forget to consider the affluence of the neighborhood, the availability of parking, and the local traffic patterns.

3. Failure to Plan

How are your planning skills?  Being a successful entrepreneur means you’ll need to be able to manage a lot of different things at once—marketing, research, development, operations, financials, etc.  It’s always a great idea to develop a business plan that will specify how you’ll handle your business’ financials, marketing, and competition.  Furthermore, if you’re seeking capital, many potential investors will want to review your business plan.

If you want to learn more about how to avoid common startup problems, check out our previous blog post on this topic here.

Research has concluded that there are certain personality traits that are correlated with entrepreneurship.[1]  Wondering how you stack up?  In this article, we take a look at the big 5 factors of personality—extraversion, conscientiousness, openness to experience, agreeableness, and neuroticism—and how they impact entrepreneurship.

Extraversion – Extraversion relates to sociability, talkativeness, assertiveness, and emotional expressiveness.  While being an extrovert can be useful for entrepreneurs who need to sell their business ideas or raise capital, surprisingly, extraversion is not associated with entrepreneurship in a significant way.  Introverts are just as capable of starting their own businesses.

Conscientiousness – This refers to persistence, hard work, ambition, drive, and dependability.  This personality trait is the one most highly correlated with entrepreneurship.  Furthermore, people who score high in conscientiousness have the strongest job performance across all industries.

Openness to Experience – Openness to experience refers to people who are innovative, imaginative, intellectually curious, creative, and nontraditional.  This is considered an important characteristic of entrepreneurs, as they often formulate new ideas and innovative approaches for bringing products and services to market. 

Agreeableness – In essence, agreeableness refers to how well someone plays with others.  An agreeable person would be considered cooperative, trusting, kind, forgiving, and tolerant.  While these people make great mates, unfortunately, they don’t often wind up as entrepreneurs.  It’s believed that this is because they are “less likely to pursue their own self-interest, drive difficult bargains, or use others to achieve their objectives.”[2]

Neuroticism – People who are highly neurotic experience negative emotions more frequently like anxiety, depression, and anger.  They have strong emotional reactions to things that are upsetting and as such, they don’t bounce back from setbacks as quickly as those who score lower on this scale.  Entrepreneurs tend to score less high on neuroticism.  If someone is going to take a professional risk by starting a business, it helps if he responds to trying situations with confidence and equanimity.

The takeaway from this research is that while these factors influence whether or not someone becomes an entrepreneur, they don’t bar entry into entrepreneurship.  If you’re high in neuroticism, for example, you can change the way you view setbacks to develop greater resilience and experience more peace of mind.  Aspiring entrepreneurs would do well to remember Walt Disney’s famous quote, “If you can dream it, you can do it.”[3]

Do you have a creative idea that you’d like to turn into cash?  Or, are you looking to create a startup?  If so, you may want to consider crowdfunding.  Although crowdfunding is relatively new, it has become increasingly popular over the past few years.  For those unfamiliar with the term, crowdfunding is the practice of funding a project by raising small amounts of money from large numbers of people, typically over the Internet. 

Primarily, there are 2 main types of crowdfunding.  The first—and the one that people most often associate with crowdfunding—is donation-based funding.  With this scenario, individuals will donate toward a common goal like creating a documentary, funding a new charity, or inventing a new product; they do this to receive various perks and rewards that are determined by the group who organized the crowdfunding campaign.  Recently, the second type of crowdfunding—investment crowdfunding—is becoming more prevalent.  Investment crowdfunding enables businesses seeking capital to sell stakes in their companies online.  In exchange, the people who contribute become partial owners or shareholders in the company.

There are at least a dozen crowdfunding websites out there.  To get you started, here’s information about a few that are most relevant to small businesses and entrepreneurs:

Kickstarter

Probably the most well-known crowdfunding site, Kickstarter has launched over 13,000 successful campaigns.  On this site, you are most likely to see creative endeavors (artwork, music, film) and innovative new product ideas.  Typically, the entrepreneurs using Kickstarter raise an average of $5,000.[1]

Fundable

On Fundable, an entrepreneur can create a profile for his startup, describe its product, and list funding goals.  Individuals who choose to fund the startup are then granted either rewards or equity in the company, depending on how the campaign is conducted.  Fundable has about 500,000 startups and on average, businesses raise $175,000.[2]

Crowdfunder

Crowdfunder works with early-stage startups and businesses raising seed stage, Series-A and Series-B funding.[3]  Designed for businesses seeking minimum investments of $10,000, Crowdfunder has an average deal size of $1.7 million.  Its network of 42,000 investors and entrepreneurs means that businesses receive wide exposure for their funding projects.