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11 Mistakes Billionaires Learned the Hard Way

11 Mistakes Billionaires Learned the Hard Way

It’s been said it’s easier to learn from your mistakes, but you don’t always have to, particularly in business. Working your way to the top can be extremely difficult and mistakes in the business world can be costly. It is important for the entrepreneur to learn not only from their successes, but also from their failures. Although there’s much to gain when it comes to experience, you can save a lot of time and money by learning through the mistakes of others.

Even today’s top grossers have had their dull moments. Here are 11 mistakes billionaires learned to avoid the hard way:

The 1 Percent
    1. Failure to research.

    When making an acquisition or starting a new business, research is essential. Is there competition? Is there a big enough market? Is your acquisition worthwhile? In 1999, the world’s richest man, Carlos Slim, did not do his research and acquired CompUSA for $800 million, only to see the company’s value plummet because desktop computers were quickly being replaced by laptop computers and other emerging technology.

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    2. Fixation on the wrong investments.

    Few things are worse than a missed opportunity. Focusing on the wrong investments can bring disastrous results. Take Bill Gate’s mistake of ignoring search engines, for example. Focusing on the loss of profit that came from piracy lead Microsoft to completely ignore the development of the search engine. This neglect left plenty of space for other companies, such as Google and Yahoo, to fill the gap. By the time Gates realized he had made a mistake, it was too late. Presently Bing has picked up some of the search engine market, but in 2011 it cost Microsoft $2.5 million more than it earned.

    3. Lack of communication.

    When offering goods or services, communication from the top directors to the employee team and from the employees to the customers is vital. You cannot expect the members of your team to immediately know what you are thinking and this is a mistake billionaire Larry Ellison experienced first hand. After acquiring Island Air, Paul Casey was quickly appointed as CEO. The lack of communication that ensued regarding the changes resulted in various flight delays (one of which was seven hours long) and many disgruntled customers.

    4. Cutting vital costs.

    Maximizing profits and cutting unnecessary costs is a natural part of business. However, it’s easy to get lost in the profit frenzy and so one should be careful such costs do not damage quality or the brand. Take for example the case of billion-dollar company Hewlett Packard. Once known for innovation, everything started to go wrong once innovation was replaced by cost cutting. Current owner and CEO Meg Whitman has seen stock price plummet 39% from one year ago.

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    Billionaire Status

      5. Letting good opportunities go.

      If you think you have a good idea or your research has proven your idea to be a sound choice, go for it. Do not let a good opportunity go by, because just like you are capable of coming up with great ideas, so are other people. Larry Page of Google learned this the hard way. In 2003, after he noticed the success of Friendster, he offered to purchase the then social media giant instead of focusing on developing his own. The offer was turned down and the result was disastrous, as Facebook swooped in to take the social media market by storm. Google+ was eventually released in 2011, and to this day has yet to match the social capital and earnings of Zuckerberg’s giant.

      6. Refusing to explore other options.

      Not all acquisitions are in great shape, and sometimes the industry you want to focus on may be shrinking. These things can difficult to accept but it is important to know when to explore other ventures. Billionaire Warren Buffet admits to having made this mistake when purchasing Berkshire Hathaway on emotional impulse in 1964. A New England textile company at the time, he kept the original business running at a loss for 20 years, before finally giving up and focusing on the company’s other, more profitable ventures.

      7. Cultivating a negative image.

      When you are a billionaire and have a brand to protect, you must behave like it. Anything negative that is said about you will reflect badly in your company and this is a mistake Alice Walton, heiress of the Walmart empire, has committed. Walmart is already involved in numerous controversies regarding the giant’s effect on small businesses and wages paid to workers. Walton’s own Texas escapades, which included a DWI, are negative publicity and include a mug shot no PR executive can wipe from Walmart’s already negative record.

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      8. Allowing credibility to plummet.

      A lot of business ventures depend on credit lines. It is important to remember that this is not only about paying your bills, but also about paying them on time. Used-to-be billionaire Eike Batista saw his oil and mineral empire plummet from more than $30 billion to a mere $200 million once key stakeholders lost trust in him after he failed to deliver the results he’d promised. Once Batista lost credibility in one area, he quickly lost it in all of them, and was forced to watch his empire shrink.

      9. Hiring the wrong people.

      Hiring is an important part of every business. Human capital is what makes a company prosper, but when hiring, keep in mind the ideals of each new hire and whether or not they fit with the company. A bad hire in an important position could be disastrous. Billionaire philanthropist Manoj Bhargava admits the worst business mistake he’s ever made is hiring the wrong people—those who enter his charity wholesale business hoping to help themselves instead of helping others.

      10. Being afraid of postponing.

      It is important to jump in to big opportunities; however, it is also important to do self-assessment to know whether or not you and your team are prepared for the next move. Billionaire Oprah Winfrey cites her TV network, OWN, as one of her biggest mistakes. Her blunder? Launching when she wasn’t ready to launch and doing so only because she said she would.

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      11. Taxes? What taxes?

      It hasn’t been proven whether or not billionaires avoid taxes more than the average citizen. However, a tax scandal is one of the most difficult things to recuperate from. The Beanie Baby creator, billionaire Ty Warner, barely escaped jail for allegedly owing $25 million in taxes, a report that will undoubtedly damage both his brand and reputation.

      Billionaire Make It Rain

        These are 11 mistakes that forced billionaires to clean up their act. As an aspiring billionaire, you should be able to learn from the mistakes of others and take these eleven points to heart as you continue your journey.

        Have you hit a stumbling block before that taught you a valuable lesson? If so, I would love to hear about them in the comments below.

        Featured photo credit: Flickr via flickr.com

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        Joel Goldstein

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        Last Updated on August 16, 2018

        16 Productivity Secrets of Highly Successful People Revealed

        16 Productivity Secrets of Highly Successful People Revealed

        The same old motivational secrets don’t really motivate you after you’ve read them for the tenth time, do they?

        How about a unique spin on things?

        These 16 productivity secrets of successful people will make you reevaluate your approach to your home, work, and creative lives. Learn from these highly successful people, turn these little things they do into your daily habits and you’ll get closer to success.

        1. Empty your mind.

        It sounds counterproductive, doesn’t it?

        Emptying your mind when you have so much to remember seems like you’re just begging to forget something. Instead, this gives you a clean slate so you’re not still thinking about last week’s tasks.

        Clear your mind and then start thinking only about what you need to do immediately, and then today. Tasks that need to be accomplished later in the week can wait.

        Here’s a guide to help you empty your mind and think sharper:

        How to Declutter Your Mind to Sharpen Your Brain and Fall Asleep Faster

        2. Keep certain days clear.

        Some companies are scheduling “No Meeting Wednesdays,” which means, funnily enough, that no one can hold a meeting on a Wednesday. This gives workers a full day to work on their own tasks, without getting sidetracked by other duties or pointless meetings.

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        This can work in your personal life too, for example if you need to restrict Facebook access or limit phone calls.

        3. Prioritize your work.

        Don’t think every task is created equal! Some tasks aren’t as important as others, or might take less time.

        Try to sort your tasks every day and see what can be done quickly and efficiently. Get these out of the way so you have more free time and brain power to focus on what is more important.

        Lifehack’s CEO has a unique way to prioritize works, take a look at it here:

        How to Prioritize Right in 10 Minutes and Work 10X Faster

        4. Chop up your time.

        Many successful business leaders chop their time up into fifteen-minute intervals. This means they work on tasks for a quarter of an hour at a time, or schedule meetings for only fifteen minutes. It makes each hour seem four times as long, which leads to more productivity!

        5. Have a thinking position.

        Truman Capote claimed he couldn’t think unless he was laying down. Proust did this as well, while Stravinsky would stand on his head!

        What works for others may not work for you. Try to find a spot and position that is perfect for you to brainstorm or come up with ideas.

        6. Pick three to five things you must do that day.

        To Do lists can get overwhelming very quickly. Instead of making a never-ending list of everything you can think of that needs to be done, make daily lists that include just three to five things.

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        Make sure they’re things that need to be done that day, so you don’t keep putting them off.

        7. Don’t try to do too much.

        OK, so I just told you to work every day, and now I’m telling you to not do too much? It might sound like conflicting advice, but not doing too much means not biting off more than you can chew. Don’t say yes to every work project or social engagement and find yourself in way over your head.

        8. Have a daily action plan.

        Don’t limit yourself to a to-do list! Take ten minutes every morning to map out a daily action plan. It’s a place to not only write what needs to be done that day, but also to prioritize what will bring the biggest reward, what will take the longest, and what goals will be accomplished.

        Leave room for a “brain dump,” where you can scribble down anything else that’s on your mind.

        9. Do your most dreaded project first.

        Getting your most dreaded task over with first means you’ll have the rest of the day free for anything and everything else. This also means that you won’t be constantly putting off the worst of your projects, making it even harder to start on it later.

        10. Follow the “Two-Minute Rule.”

        The “Two-Minute Rule” was made famous by David Allen. It’s simple – if a new task comes in and it can be done in two minutes or less, do it right then. Putting it off just adds to your to-do list and will make the task seem more monumental later.

        11. Have a place devoted to work.

        If you work in an office, it’s no problem to say that your cubicle desk is where you work every day.

        But if you work from home, make sure you have a certain area specifically for work. You don’t want files spread out all over the dinner table, and you don’t want to feel like you’re not working just because you’re relaxing on the couch.

        Agatha Christie never wrote at her desk, she wrote wherever she could sit down. Ernest Hemingway wrote standing up. Thomas Wolfe, at 6’6″ tall, used the top of his refrigerator as a desk. Richard Wright wrote on a park bench, rain or shine.

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        Have a space where, when you go there, you know you’re going to work. Maybe it’s a cafe downstairs, the library, or a meeting room. Whenever and wherever works for you, do your works there.

        12. Find your golden hour.

        You don’t have to stick to a “typical” 9–5 schedule!

        Novelist Anne Rice slept during the day and wrote at night to avoid distractions. Writer Jerzy Kosinski slept eight hours a day, but never all at once. He’d wake in the morning, work, sleep four hours in the afternoon, then work more that evening.

        Your golden hour is the time when you’re at your peak. You’re alert, ready to be productive, and intent on crossing things off your to-do list.

        Once you find your best time, protect it with all your might. Make sure you’re always free to do your best uninterrupted work at this time.

        13. Pretend you’re on an airplane.

        It might not be possible to lock everyone out of your office to get some peace and quiet, but you can eliminate some distractions.

        By pretending you’re on an airplane, you can act like your internet access is limited, you’re not able to get something from your bookcase, and you can’t make countless phone calls.

        Eliminating these distractions will help you focus on your most important tasks and get them done without interruption.

        14. Never stop.

        Writers Anthony Trollope and Henry James started writing their next books as soon as they finished their current work in progress.

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        Stephen King writes every day of the year, and holds himself accountable for 2,000 words a day! Mark Twain wrote every day, and then read his day’s work aloud to his family to get their feedback.

        There’s something to be said about working nonstop, and putting out continuous work instead of taking a break. It’s just a momentum that will push you go further./

        15. Be in tune with your body.

        Your mind and body will get tired of a task after ninety minutes to two hours focused on it. Keep this in mind as you assign projects to yourself throughout the day, and take breaks to ensure that you won’t get burned out.

        16. Try different methods.

        Vladimir Nabokov wrote the first drafts of his novels on index cards. This made it easy to rearrange sentences, paragraphs, and chapters by shuffling the cards around.

        It does sound easier, and more fun, than copying and pasting in Word! Once Nabokov liked the arrangement, his wife typed them into a single manuscript.

        Same for you, don’t give up and think that it’s impossible for you to be productive when one method fails. Try different methods until you find what works perfectly for you.

        Featured photo credit: Unsplash via unsplash.com

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