I’ve seen this sign before but I’ve finally taken notice. Here’s how these 10 rules have applied to Myine and Livio Radio: (Jimmy Johns has this sign up in their Royal Oak, MI restaurant)
Reinvest your profits: I’ve been paying myself just enough money to keep the mortgage paid and putting everything we make back in the company. I’ve even cut back on contract staffing to keep all my cash going back into radio inventory to make sure we can fulfill orders and keep up with demand.
Be willing to be different. Pandora and NPR branded radios…. Duh. Also the concept of making radios for boomers, not totally different but we’re not afraid to say it.
Never suck your thumb. My business partner Massimo Baldini and I make decisions quickly based on the info at hand and move on. Specifically when we decided to invest into Pandora, we put out the pro’s and con’s on a sheet of paper, talked about it, then put down the deposit for engineering and production. (All within an hour)
Spell out the deal before you start. Recently we visited a new branding partner for a kids radio. We went into the meeting with the general deal terms in the form of a memorandum of understanding (MOU.) We were 100% upfront with why the deal makes sense for Livio and some of the things we look for in the deal. I can’t stress enough this point to figure out why you are going to do what you do before you spend any time actually doing it. Plus once you land the deal, it’s too late to figure out it’s a bad one.
Watch small expenses. For us the main thing we can cut back on is travel. I don’t expense millage; I just fill up the Pathfinder with my company credit card when on the road. I fly coach and stay with fraternity buddies when I’m on the road. I typically eat out at subway (unless I’m with a customer) We also try to do day trips whenever possible to save money on hotels (when there’s no vacancy at my frat buddies bachelor pads)
Limit what you borrow. I have no personal debt (except for my mortgage on my house and about $25,000 in student loans) I pay of my CCs every month for the business and personal. I’ve actually started giving myself a cash allowance every week
Be persistent. I still remember at CES 2008 when I told Pandora I was going to make the Pandora radio and I fought like hell to make it happen. Warren Buffet says “be persistent,” however during a recession I would change that to “be relentless” to get what you want.
Know when to quit. The major item here is that you make decisions based on the info at hand. I can’t cite a specific here due to confidentiality, however I can say that just because you make a decision, doesn’t mean you can’t and shouldn’t walk away from it in the future. You have to weigh out the cost of staying with it versus the upside of sticking with it. Either I don’t beat myself up over it because “I made the right decision at the time I made it.”
Assess the risks. As an engineer, this is the easiest part of my day. I use FreeMind Mindmap software (free open source software) to help tree out the potential risks and outcomes of every major decision. If you’re not an engineer and this doesn’t come naturally, just draw a line down the middle of a piece of paper and make a pro-con list. Remember that you can’t tell the future, just make a decision and stick it. (refer to rule #3 about never sucking your thumb.)
Know what success really means. I love music and electronics. Success for me is waking up everyday and absolutely knowing that this is what I’m meant to do in life. I may not be the wealthiest guy in the world, and I may never turn our brands into the next Apple. However knowing I’m being honest and true to my customers, staff, and investors, and myself, gives me the true feeling of success.