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10 Books You Need To Read Before Starting Your Business

10 Books You Need To Read Before Starting Your Business

There are essentially two main paths to success in business: either do it all on your own and make a lot of mistakes in the process, or learn from others’ mistakes and cut your learning curve considerably. If you’re like me, then you’ll prefer the latter route.

As an aspiring entrepreneur with a goal of building a profitable business, it might be worth taking the time to read a few books before you get started. You will still need to learn through your own failures, but why not get started on the right foot with a few tips from some experienced and successful entrepreneurs?

Since starting my first online business over 7 years ago, I have read over 250 business books, but these are the ones that have especially stuck with me.

1. Ask by Ryan Levesque

ryanask

    Ryan Levesque is a successful entrepreneur who left a corporate job in Shanghai, China to pursue his passion of starting an online business. Within a short period of time he was able to build over 20 successful companies online and hasn’t looked back since.

    He used to be known as the “secret weapon” for many entrepreneurs, but after a health scare, he realized it was time to share his knowledge with the world. He created his “ask” formula to promote success – which are a series of questions and surveys that help you gain deep insights about your target audience.

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    Ryan Levesque’s book Ask made me look at internet marketing and online business in a new way. Instead of trying to “guess” what my prospective customers need or want, I now use his formula to glean new insights so that I can build solutions that my customers actually want. If you too want to succeed online and don’t want to waste time and money, then grab a copy of Ask.

    2. DotCom Secrets: The Underground Playbook for Growing Your Company Online by Russell Brunson

    dotcomsecrets

      DotCom Secrets is my favorite book from this list. I keep returning to it over and over again when I need to setup or optimize my sales funnels. And what better person to learn from than the master of sales funnels himself: Russell Brunson? Russell has been successfully building sales funnels for himself and his clients for as long as I can remember, but I never really took interest in his work until recently. He offered this book for free + shipping on his website, so I thought I’d see what he’d come up with.  I wasn’t disappointed; it’s become my goto book for sales funnels ever since.

      3. The $100 Startup by Chris Guillebeau

      100dollarstartup

        Could you really start up a business on $100 budget? Chris Guillebeau says you can and makes the case by interviewing over 1500 entrepreneurs on their journey to building successful startup companies – many who started with a modest budget of less than $100. Chris Guillebeau himself is an entrepreneur that has a knack for turning ideas into income online and travels the world while living running successful businesses online. This is a great book to pick up if you need some motivation and want to learn some hard-earned lessons from entrepreneurs that have made it online without large budgets.

        4. The Art of Work by Jeff Goins

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        artofwork

          If you’re not starting a business with the single intention of making more money, and would like to do something meaningful – something around your true calling or life’s work — then look no further than the Art of Work by Jeff Goins. Jeff has decided to take a different approach than his colleagues stating that your life’s work isn’t something you follow, but rather something that happens out of tragedy. His book answers the question: what was I born to do? By the end of it, you should gain some clarity on what your vocation may be.

          5. 80/20 Sales and Marketing: The Definitive Guide to Working Less and Making More by Perry Marshall and Richard Koch

          80-20perry

            You may have already heard of the 80/20 rule which states that 80 percent of your results come from 80 percent of your efforts. This powerful concept – called the Pareto principle – is elucidated beautifully in Perry Marshall’s book, 80/20 Sales and Marketing: The Definitive Guide to Working Less and Making More. Perry Marshall is known by many as the authority on Facebook and Google Adwords.

            His goal in this book is to help business owners save time and money by using the 80/20 rule in their businesses and to boost productivity. When I first read this book, it cleared up a lot of areas for me including how to best use my time, money and effort to focus on the things that mattered in my personal life and business. I would recommend this book to anyone looking to get the most out of their time and money.

            6. Nail It then Scale It: The Entrepreneur’s Guide to Creating and Managing Breakthrough Innovation by Nathan R. Furr and Paul Ahlstrom

            nailitthenscaleit

              I have read all of the lean startup books, but Nail It Then Scale It by Nathan Furr and Paul Ahlstrom – innovation and entrepreneurship experts – takes the cake. It essentially distills the lean startup methodologies and breaks it down step by step for aspiring entrepreneurs so that they have the best possible chance of building a profitable business. Their no-nonsense approach to building a business is a breath of fresh air, as they show you how build a business from the ground up. They say that the “reason most businesses fail is because they do the right things, but out of order”. So by learning the correct sequence to start a business, you have a much higher chance of success. If you want to start your business on the right foot, then check out this book.

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              7. Hooked: How to Build Habit Forming Products by Nir Eyal

              hooked

                Hooked by Nir Eyal — a behavioral design specialist that helps companies create habits that more effectively engage their users — is a book about building habit forming products. One of the questions he answers in the book is why some people create companies that keep users coming back for more, and why others fall flat?  He gives many examples on how successful companies such as Facebook, Twitter and others have used the power of creating habit forming technologies to hook their customers. He outlines a simple 4-step process that believes is the underlying pattern of successful companies. Whenever I create products, I refer to this book because it’s an extremely intuitive, useful and effective way to create solutions that will keep people hooked.

                8. Playing to Win: How Strategy Really Works by A.G Lafley and Roger L. Martin

                playingtowin

                  Without a solid business strategy, you can’t win according to A.G. Lafley and Roger Martin. Together, they doubled Proctor and Gamble’s sales, quadrupled its profits, and increased its market value by more than $100 billion in ten years.

                  Their main goal in this book is to show you how to think strategically by asking 5 poignant questions: what’s your winning aspiration, where will you play, how will you win, what capabilities must you have in place to win, and what management systems are required to support your choices? By knowing the answer to these questions, you’ll position yourself to win in business.

                  In the book they give many examples and walk you step-by-step through each of these questions. I strongly believe that all aspiring entrepreneurs should have a strategy in place before they launch their business so that they have a solid roadmap. So whether you plan to start an online business, or build an offline empire, this is a book I’d recommend reading before launching it.

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                  9. Launch by Jeff Walker

                  launch

                    Jeff Walker is the father of product launches. He went from being a stay-at-home Dad to an internet marketing millionaire in a relatively short period of time using his product launch formula. His formula is relatively simple, and will work for anyone that plans to launch their product or service online. Anytime I do a product launch I refer to this book often since it shows you how to do it successfully step by step.  This book is a culmination of all of Jeff’s hard work and successes with his clients who have created over half a billion dollars in sales. If you’re looking to launch online, then definitely consider this book.

                    10. The 4-Hour Workweek: Escape 9-5, Live Anywhere, and Join the New Rich by Tim Ferris

                    4hhourworkweek

                      The 4-Hour Work Week by Tim Ferris was a game changer for me. When I first got started with online business, I was under the impression that I’d be stuck working 60 hours a week if I wanted to maintain my lifestyle and income. But I soon realized how wrong I was. Tim Ferris says that you can create a lifestyle in which you earn more money, and work less, if you automate your business. By setting up systems you can grow your business faster and work less hours. If you’ve been working at a 9-5, then this may seem like an esoteric concept, but it’s certainly attainable as many entrepreneurs have done this, including myself. If you’re looking to escape your desk job, then read the 4-Hour Work Week.

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                      Published on December 13, 2018

                      How to Start a Company from Scratch (A Step-By-Step Guide)

                      How to Start a Company from Scratch (A Step-By-Step Guide)

                      If you’ve ever thought about starting and running your own business, you’re not alone. Being your own boss, having flexibility with your schedule and keeping more of the financial rewards that come with business ownership are all good reasons to own your own company.

                      But as you might expect, it’s not all vacations and fat bank accounts. According to the SBA, 2/3 of businesses survive at least 2 years and approximately 50% survive 5 years.[1] So why is the failure rate so high? At least for the businesses that fail early on, lack of, or poor planning can be a major factor.

                      So how to start a company?

                      Starting a business from scratch doesn’t have to be hard or complicated, but it does take planning and work. Here are the first and most important 9 steps to take when your are starting a company from scratch.

                      1. Do an Honest Evaluation of Yourself

                      Do you work better in a structured or unstructured environment? Does a daily routine reduce your anxiety? What kinds of things are you good at? Does public speaking or making presentations make you nervous? Are you good at accounting and numbers? Can you handle the rejections you’re bound to get when selling or cold calling?

                      These are all important questions to ask yourself, in fact it’s a good idea to get other peoples opinion about their perception of you in each of these situations.

                      Whatever the answers you come up with for your evaluation, remember that’s all it is, an evaluation of where you are now. Think of it as a way to identify both your areas of strength and weaknesses.

                      You maybe good at public speaking which can help when raising money, but bad at accounting which just means that you’ll need to find some kind of help with that area of the business.

                      2. Evaluate Your Idea

                      If your business idea involves a new product or service (or even an enhancement to an existing product or service), it needs to be evaluated. This is technically called market research.

                      There are firms that specialize in doing market research for new products, but if you are on a tight budget, you can do this yourself.

                      First, if you can build a prototype for people to use, touch and look at that’s the best option. If a prototype is not possible or it’s a service business, then offer a highly descriptive presentation of the business plan complete with it’s unique benefits and how it’s different from the competition.

                      Then listen! Remember that this is not about others liking your product, this is not your baby that they are talking about. You want honest market research that gives you the best chance for a successful business. Take notes, when someone tells you that they didn’t like a feature or some aspect of your idea tell them ‘Thank you”.

                      After several rounds of market research with different groups of people, you should see patterns emerging about things that they both liked and didn’t like. Use this information to tweak your product or service and do another round of market research.

                      Keep in mind that you’ll never come up with a universally loved product, your job is to produce a product or service that appeals to the broadest range of your target market.

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                      3. Make a Business Plan

                      I know, I know this isn’t the “fun” part of starting your own business, but it is an very important step in creating a successful business!

                      Basically, you can think of a business plan as an outline or blueprint of your business. A good business plan should have the following elements:

                      • Executive Summary – This should lay out the businesses product or service and the problem that it solves for the consumer.
                      • Market Evaluation – This should talk about the market you are serving. Is it an expanding market, and how does your product better fulfill the consumers in that market.
                      • Market Strategies – How are you going to penetrate the market and sell your product.
                      • Operational Plan – How will the company run from day to day? Who are the key employees and what are their specific rolls. Do your key players have specific goals set for them in advance?

                      A final word on making a business plan: while lying is never acceptable especially when you are using the business plan to raise money, it is acceptable to “put your best foot forward”.

                      Playing up the positives while minimizing the negatives is almost expected in a business plan.

                      Besides, banks as well as professional investors will both do a more in-depth analysis before investing any money into your idea.

                      4. Decide on a Business Structure

                      You have many options here, and discussing them with your accountant or financial adviser is really the only way to know what’s right for you. But just to give you a quick rundown of the types of business entities and their pros and cons we will briefly go through them:

                      Sole Proprietorship

                      This is a common way for small businesses to get started.

                      The pros being:

                      Relatively low costs to set up (usually a business license and sales tax license).Owners normally do not have to set up a special bank account, they are allowed to use their personal one. Any income earned can be offset by other losses (check with your state!). You as the sole proprietor have complete control over all decision making. 

                      Finally, sole proprietorship’s are relative easy to dissolve.

                      The cons of using a sole proprietorship include:

                      You as the sole proprietor can be held personally responsible for the debts and liabilities of the company. Some benefits, such as health insurance premiums, are not directly deductible from business income.

                      If you need to raise money, you are not allowed to sell an equity stake in the company. In that same vein, hiring key people maybe more difficult because you cannot offer them an equity stake in the company.

                      Partnership

                      A partnership is formed when two or more people decide to start a business. Although there is no legal requirement for any documentation to form a partnership, it is my advice that you never enter into a partnership without having a partnership agreement. (Remember, spending $1500 now can save you $150,000 in legal fees later!).

                      The pros of a partnership include:

                      Being relatively easy and inexpensive to start. Hiring key employees can be easier as you are allowed to give equity ownership to as many partners as you want.

                      For tax purposes, partnerships are relative simple as any income is treated as “pass through” meaning that each partner pays tax on their individual portion of the partnerships income (As of this writing, always check with your tax adviser).

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                      As far as the cons go:

                      It can be difficult for some general partnerships to raise capitol. Because it is a partnership, the actions of one of the partners can obligate the entire organisation. All profits must be shared according to the partnership agreement regardless of the amount of work done by any single partner.

                      Some employee benefits may not be able to be deducted on income tax returns.

                      Limited Liability Company (LLC)

                      This is a very popular business entity for small to medium sized businesses. The reason for this is the cost of set up is not prohibitive and there is a separation between the owners and the company.

                      The pros of an LLC include:

                      Limited liability for the partners, unlike sole proprietorship’s and partnerships where the owners are held responsible for all of the companies debts and liabilities, an LLC provides some protection against certain debts and liabilities that are solely the companies.

                      Simple taxation, just like the sole proprietorship and partnerships, income is considered “pass through” and is only taxed once on an individual level.

                      There is no limit on the number of shareholders in an LLC. An LLC requires fewer fillings and administrative requirements than a corporation.

                      Corporation

                      A corporation is much more complex and expensive to set up. And a corporation is legally considered an independent entity that is separate from its owners.

                      The pros of a corporation include:

                      Complete separation between the owners and the company. Because the corporation is considered its own legal entity, owners can not be held personally responsible for any debts or liabilities of the company.

                      A corporation can raise capital much easier just by selling more shares in the company.

                      Cons of corporations include:

                      Much higher administrative costs than any other business entity. Corporations generally have a higher tax rate. Dividends are not tax deductible for corporations. Income paid in dividends is taxed twice, once by the corporation and again by the shareholder.

                      Again, this is just a short summary of the pros and cons, always check with your tax adviser about what will work best in your situation.

                      5. Address Finances

                      Again, not one of the “Sexier” parts of starting your business from scratch, but very important nonetheless.

                      So, you’ve done your business plan and an estimate of your start up funding should be included. It should include the amount of funding you’ll need to get you through your first full year of operations.

                      Now, how do you get that money?

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                      Self Funding

                      If possible, self funding is the easiest. You won’t have to go to banks and investors with hat in hand, or give up ownership or control of your company. But as we know, this is not a reality for most people. But don’t worry, there are still plenty of options available.

                      Friends and Family

                      They can be a good source of funding your business if they can see and understand your vision.

                      Remember that business plan? Pass them out to everyone you know. Then follow up, be prepared to tell them the total amount of money you expect to raise, the minimum investment you are looking for and what you will give in return for the investment.

                      For example, you give a friend your business plan and follow up with him/her a few days later. You can explain that you have secured funding for $80,000 of the $100,000 you need. You are selling a 2% share in the company for every $2,000 investment. How many shares would he like?

                      And when he/she tells you no, thank him/her and ask if he/she can think of anyone off the top of his head who might be interested? Tell him/her you really appreciate his/her time and if he/she does come across someone who might be interested to let you know.

                      Banks

                      These guys are happy to lend you money when you don’t need it, but all of the sudden they get stingy when you actually need a loan! This is where preparation comes in.

                      It’s a good idea to go over your business plan with an expert and maybe even have it rewritten by an expert before you approach either a bank or professional investor. Both will want to go over your business plan with a fine tooth comb, verifying all the numbers and data you provide.

                      You should also brush up on everything in the plan so that you can answer any questions they have with authority.

                      Crowdfunding

                      Finally, there is crowdfunding through sites like Kickstarter or GoFundMe. Crowdfunding helps to build interest, community spirit, and a customer base. It’s also an efficient way to raise funds. You can take a look at these tips to find out more:

                      6 Crowdfunding Tips To Get Your Project 100 Percent Funded

                      6. Register with the Government

                      As stated earlier, different types of business entities have different filling and administrative requirements. At the very least, you’ll probably need a business license as well as a state sales tax license.

                      Unless you are forming a corporation, there are many good resources on the web that will do everything for you at a minimal cost.

                      7. Assemble Your Team

                      Remember when we evaluated your strengths and weaknesses? Here is where we fill in the gaps!

                      Do you hate sales and cold calling? Great! There are people who love selling and wouldn’t want to do anything else.

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                      Bored to death with accounting? There are a ton of small accounting firms out there that will take care of that for you.

                      What about marketing? You can hire someone in-house or out-source that too.

                      Your job is to keep on top of all the different aspects of the business to make sure they are all running smoothly and getting the results you need. If not, it’s your job to figure out the problem and implement a solution.

                      Check out this guide and learn how to delegate effectively:

                      How to Delegate Work (the Definitive Guide for Successful Leaders)

                      8. Buy Insurance

                      No matter what kind of business you start, you need insurance! Yes, I know, no one likes to buy insurance, but it can literally be the difference between having a minor inconvenience and declaring bankruptcy.

                      We live in a very litigious time, even a minor slip and fall at your place of business could bankrupt you without insurance. If you need help finding a good agent, check with your local trade organizations or fellow business owners.

                      9. Start Branding Yourself

                      Has anyone ever ask you for a Kleenex or a QTip? We all know what they are because of branding, Kleenex is just a brand of tissue and QTip is just a brand of cotton swab. It doesn’t have to be as widely known as Kleenex or QTip, but you can make your brand a common name within your niche.

                      I once owned a manufacturing company that developed a product that was so popular that my competitors started co-opting my brand name for their products.

                      If you aren’t sure how to kickstart branding yourself, check out these ways:

                      5 Ways to Build your Personal Brand & Make More Money

                      The Bottom Line

                      Starting a business from scratch can be one of the most rewarding experiences a person can have.

                      But do you know what’s even more rewarding? Having a business that succeeds, is profitable and provides a good source of income for you, your employees and their family’s.

                      More Resources About Entrepreneurship

                      Featured photo credit: Tyler Franta via unsplash.com

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