Starting a business is tough. Just ask James Altucher, he’s founded or co-founded 20 companies and failed at 17 of them.
Altucher, managing director at Formula Capital, has collected the results of his 17 failures and 3 successes in “The Ultimate Cheat Sheet For Starting And Running Your Business.” In it, he answers 101 of the most commonly asked questions about founding and running a company.
There is practical advice: “Know everything about the clients: competition, employees, industry. Over-read everything.”
Motivational advice: “You create your luck by being healthy and not regretting the past or being anxious about the future.”
And comical advice: “Don’t smoke crack.”
The Daily Ticker sat down with Altucher to discuss his motivations in creating the list and his most essential tips.
“A lot of people say to me ‘Oh, I have this great idea. I’m going to quit my job and get venture capital funding,’” he says. “The reality is, you do not want VC money that early and, by the way, they’ll laugh at you because you don’t have a product or customer.”
Altucher also has a bone to pick with the emphasis new businesses place on social marketing. “The reality is social media is marketed to a free audience. Nobody pays to be on Facebook, nobody pays on Twitter, so you really need to know what you’re doing to sell a product to an audience that’s used to getting things for free. And your free audience is going to kill you, they will never want to pay you for anything.”
Another tricky situation is dividing equity between founders, but Altucher’s response is simple: “divide equally and then make sure people vest over four years.”
Surprisingly (or maybe not so surprisingly), Altucher is most often asked about when it’s okay to have sex with an employee. His response, “it is okay to have sex with an employee as long as you love that employee and they love you and you disclose it to your bosses and so on.” There is a stipulation, however, “One of you has to quit if you ever break up.”
So what is Altucher’s most important business advice? Watch the video above to find out.
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