First, let’s take a minute to talk about what an e-Myth is. An entrepreneurial myth, or “e-myth”, is an assumption that anyone can succeed at business only with:
- A Certain Skill
- A Target Market
Acclaimed author and business leader, Michael Gerber in his groundbreaking book “The E-Myth”, details the downfall of great ideas and businesses that fail to succeed because founders often have wrong ideas about how to scale and pivot their business.
In order to build a business that runs smoothly, with or without you, and that creates a strong valuation…you must learn how to let go of the reigns and build a sustainable business around you.
Originally published over 30 years ago, the concepts in the E-Myth™ still hold true today. Statistics show that 90% of new businesses/startups fail in their first year and 80% after the 5th year in business.
The question is…WHY? And how you can be sure your business does not fall victim to it?
The E-Myth™ details how running a business and getting technical work done are two different things. It shows you how you can set up a company that depends much more on systems, than on people, and can basically be handed over to anyone with the right instructions.
Here are 3 lessons that’ll help your business survive the early years as well as pivot so you can thrive:
- Having great technical skills does not mean you know how to run a business.
- Imagine your business as a nationwide franchise from day one, then build the first “store” (even if just in theory).
- The franchise approach makes sure you build a business based on systems, not people.
PRO TIP: Having great technical skills does not mean you know how to run a business.
People think being great at a technical skill also makes you great at running a business. This is dangerous thinking. Being a great chef, painter, recruiter or manufacturer does not make you good at running a business. Once you start a business, you’re not just the person doing the technical work, all of a sudden you’re also the CEO, CFO, CTO, CMO, and a whole bunch of other things.
You have to get customers, track and manage finances, create advertising material, answer customer requests, set a strategy, and, and, and…..
If all you know is how to make great coffee, then your first café is very likely to fail – after all you will have to figure out how to hire, outsource tasks, manage people, and grow a business!
PRO TIP: “Think” of your business as a national franchise, then build one.
You don’t have to buy a franchise to function like one. If you plan your business as a nationwide franchise from day one, you’ll end up systematizing everything as soon as you get a handle on things, which will then allow you to remove and replace yourself from that job and sustainably grow the business.
PRO TIP: Build a system of systems, so your business doesn’t rely on people’s skills.
If you continue to weave the idea of systems as a constant thread in your business, you’ll end up with a system of systems, which seamlessly work together.
Instead of doing all the work yourself, it now becomes your job to make sure the systems run smoothly together, which will also help you make sure your future “franchisees” (ie. Product lines, service offerings etc) are successful in running their own areas.
So… ask yourself if you are falling into the E-Myth trap by thinking about…..
- Why a business goes through the same stages a human being does
- Which questions you must ask yourself to find your entrepreneurial model and perspective before even starting
- Why you don’t just have one business personality and how your inner manager, entrepreneur and technician can work together
- How the turn-key revolution boasts a 75% business success rate
- What you can do to find your primary aim in business
- Why organizational charts are crucial, even though you might not like them
- How a great people-management-system works better than hiring great people
- Why you must focus on the customer and only the customer (and how it’ll replace your marketing)
Ready to debunk the E-Myth for your business? Let’s do it! Click and Download my “Wheel of Success” and see how my team and I can help you grow your business or idea!
“If your business depends on you, you don’t own a business – you own a “JOB”. And it’s the worst job in the world because your are working for a lunatic!”
– Michael E. Gerber