Here at E[nstitute] we are advocates for those entrepreneurs that are constantly paving the pathway for future generations. We also believe that they have a lot to teach! We’ll be starting a series of interviews with entrepreneurs that we think are game changers and trailblazers.
Last week we had the pleasure of interviewing Michael Johnstone of Mark Cuban Companies who has a wide range of experiences on both sides of the table: technical and businesses background.
What led you to become an entrepreneur?
I had many family members who ran their own businesses; you could say that it ran in my blood. Having many mentors who were successful at running their own businesses motivated me and made it seem like a natural part of life. You’ll constantly find me working on new projects and tackling problems.
We all learn from our mistakes, what was something that you learned early on from one of your failures?
My first company idea was similar to Quora and Yahoo! Answers, where people could have a platform to ask questions and have experts answer them. It predated Yahoo! Answers by a couple years but there was not an easy way to make money from it. I needed the business to cash flow and that business model didn’t work. Eventually I started eLocomotive which went on to be a very successful software and website design company but not before learning to fail and fail fast.
One concept that I’ve taken to every I work with is to start by defining a system, then measure your success, and adjust what’s not working. Another important factor is never losing focus on what the “core business” is. Many companies start a dozen new projects/features at the first sign of success. Ideas are easy. Don’t let that distract you from the hard work of success.
What are a few key factors in helping you scale your businesses?
There are a few factors that have assisted me in scaling my businesses. The sooner you can find your market fit, the better. Be willing to adjust to the market. History is full of great ideas people wouldn’t pay for and if you’re not making money, you’re not in business. New markets are great but don’t rush into them if you haven’t dominated the first one.
Focus on the business value, not the exit. A successful business always has options but big dreams bring big distractions.
Fire quickly. A person with poor customer service skills, no discipline, or who isn’t diligent won’t change. At least not as fast as you need them too. As a trainer, I always preferred customer service skills because I could teach the technology.
As a multifaceted CEO how do you stayed informed across the technical and business aspects of your company?
I consume a lot of information from websites, magazines, and social media. RSS feeds make that much easier. Equally as important, I try a lot of things. That helps me internalize the information and test it’s limits (and mine). I always suggest to constantly ask questions- never shy away from asking too many either. Applying everything that you learn is essential- it is one thing to learn but another thing to do.
Finally, you must have great advisors who are people you like and respect. I’m not concerned about formal ones. I’m concerned about subject matter experts who can answer a question or give me the landscape quickly. I’ve found that the great ones love sharing their knowledge. It’s easy for them.
One last question – we have talked about starting a business, scaling a business and the more quantitative skills needed, how would you recommend acquiring the soft skills needed in association with running a company?
It’s hard to tell the key soft skills for everyone to acquire or a simple way to acquire them. Most soft skills come from practice on the job, in real world situations. Reading customer service case studies is not the same as dealing with an angry customer. Knowing how to read a P&L statement is not the same as knowing the pressure that comes when you’re responsible for it. Textbooks and classes will only teach you so much. You must experience things on your own to understand how you would handle them yourself.