Two Things You Need To Know About Yourself Before Starting Any Business

“Know thyself” is one of the oldest pieces of advice in Western thinking. It is inscribed above the entrance to the Temple of Apollo at Delphi, and it appears multiple times in Plato’s dialogues (even he called it “old wisdom”). You could think of it as the shortest self-help book ever written. These sayings don’t stick around for 3,000 years for no reason. If you’re looking for good business advice, you could do a lot worse than those two simple words: “know thyself”.

Because not “knowing thyself” could cost you a big pile of money. . . possibly, even your life!

There are business – and personal – perils of not “knowing thyself”.

History is full of people who didn’t understand their own strengths and weaknesses, and let me tell you—it never ends well!

Rudolf Diesel was one of those people. As the inventor of the diesel engine, he should have become fabulously rich. Instead, unfamiliarity with the world of business nearly broke him financially, and he (likely) committed suicide by jumping overboard in the middle of the English Channel. It’s a story you hear over and over again – the gifted inventor who fancied himself an entrepreneur, driven to financial ruin by unscrupulous associates. Don’t be Diesel!

On the other end of the spectrum is John Sculley. Sculley is most famous for firing Steve Jobs from Apple. We all know how well that worked out for him (AAPL -0.7%). While he was a talented marketer – he invented the Pepsi challenge after all – he didn’t have the technical knowledge or product expertise that Jobs did, and failed to replicate any of the early successes of the company. It took Jobs’ return in 1997 to change that and turn Apple around.

It’s only fair that I include one of my own biggest failures in this column. While I’ve invested in more than 500 products, I’ve only tried to invent one by myself. It was a lighter shaped like a cigar—goofy, right? At the time, I loved it. Eventually, I’d dumped half a million dollars into the product with nothing to show for it! So, while I’m a good investor and business owner, I learned that trying to invent new products on my own would surely end in disaster.

THE TWO THINGS YOU NEED TO KNOW

There are two particularly important questions you need to answer about yourself:

1. What are my strengths as an entrepreneur/business owner?

2. What are my weaknesses as an entrepreneur/business owner?

HOW DO YOU ANSWER THESE QUESTIONS?

The only real sure-fire way to answer these questions is to experiment, try and fail. In the postmortem of any business venture, it should be easy to see what went well, what went poorly, and how much of it – the good and the bad – was your fault. You do analyze your ventures after the fact, right?

That’s why it’s so vital that entrepreneurs have some reasonable business experience under their belts before coming to me looking for investment.

I’ve had entrepreneurs in front of me who didn’t want to talk about their previous projects because they failed and it was embarrassing to them. They didn’t know that I don’t care about the failures so much. What I care about is whether or not they learned about themselves through failure.

Don’t be scared. We’ve all wasted cash and time on our own cigar-shaped lighters. You just have to make sure that you’ve wrung every last bit of self-knowledge out of each experience.

If you’re still not sure what your strengths and weaknesses are, don’t hesitate to consult a mentor, or peers in a mastermind group. Ask them for candid feedback – they’ll give it to you. But keep in mind that it will be colored by their experiences and biases. That’s okay – it’s still useful information. Just keep in mind that a marketing guy is going to focus on marketing, inventors are going to focus on products, etc.

And anyone recently burned by their own failures in one area is going to focus on that in their feedback.

Know your strengths. Know your weaknesses. Don’t be afraid to try things and fail. Those failures will teach you what your strengths and weaknesses are. When you try again, build your business around the strengths. The more you “know thyself”, the closer you’ll be to your success!