So many leaders view their struggles as unique. For example, unforeseen situations they couldn't have predicted and were impossible to avoid. Not true, according to serial entrepreneur and equity investor Matt Higgins, who I had the opportunity to interview.
Higgins says that some of the best preparation for his career goes all the way back to his early days as a reporter. The reason, he insists, is pattern recognition.
"A reporter sits in the stream of information," Higgins told me, "and sees the patterns of life play out again and again. If you witness enough business crises, you learn to spot them in advance and can act to prevent them."
In his new book, Burn the Boats: Toss Plan B Overboard and Unleash Your Full Potential, Higgins devotes an entire chapter to unpacking some of the patterns he most often sees in the entrepreneurs he works with and how to avoid them before they become true crises.
Whether external circumstances you need to manage against or internal modes of thinking that trap you into making bad choices, "it's critical," Higgins says, "to recognize them before we inadvertently sabotage our success."
Higgins shared with me the 7 patterns that he sees come up over and over, that entrepreneurs need to be mindful of along their journey:
1. Wrong partners
A bad partnership can drive a whole business into the ground. "In anything you do," Higgins advises, "look very closely at whether it's a partner you need or merely an employee with a particular skill set."
2. Not enough money
Your idea might be great – but if you don't have enough funding to carry you through to when the market will recognize and appreciate it, then your business is never going to survive. There are all sorts of great ideas that died because the money simply ran out.
3. You can never predict the timeline of success
"All of us expect reward far too soon," Higgins shares. "We are seduced by the thoughts in our own heads and we imagine that others are thinking them too. I often think I'm late to an idea when I'm actually incredibly early."
4. You can't do it all
CEOs have so much trouble delegating, afraid that no one can do their job better than they can themselves – but they fail to understand that delegating to others is a huge part of what the role requires. One person can't do it alone.
5. Don't play small
Higgins's business partner at RSE, Stephen Ross, has a saying: "The less you bet, the more you lose when you win."
This cuts against the typical advice we hear about diversification. "When our heads and our hearts are fighting," Higgins says, "it's easy to split the difference. We make a small bet, so we won't feel too bad if it turns out we're wrong. But if it's worth going in at all, then it's worth going all in."
6. Don't Buy the Hype
Look at Theranos, the ill-fated health tech company that fell apart when it was revealed to be a fraud.
Founder Elizabeth Holmes put together a shiny board of directors consisting of luminaries and octogenarians, including Henry Kissinger, Bill Frist, James Mattis and David Boies and used their fame to lure investors. But big names are no substitute for good information. Don't be seduced for the wrong reasons.
7. Sometimes We Have to Let Go
We stick with ideas too long in part because of the sunk cost fallacy, the notion that what we have already invested in a flawed endeavor justifies our continued investment.
"Don't do it," Higgins advises. "You need signs of traction. You have to recognize when the market has spoken."
Keeping these seven patterns in mind can help entrepreneurs avoid so many of the pitfalls that they might encounter along the way. Spot the pattern – and then act immediately to overcome it.
Inc
