Why most business advice is bad for you
Here's how you can discern between helpful and harmful advice
Today, I will cover why much of the advice you read online or receive from others can set you up for failure, and how you can apply critical thinking to identify relevant vs irrelevant advice.
Knowledge is essential for entrepreneurs
As an entrepreneur, you must learn how to do many things on the fly. Especially as a solopreneur without a team, you need to learn many disciplines quickly: development, product, marketing, sales, content, operations, and more.
Without the proper knowledge, you cannot execute your vision and make it a reality, and you risk making mistakes that will cost you a lot of time and money.
You don’t have unlimited time to learn all these skills through trial and error, so you must learn from others.
Advice is everywhere
Fortunately, we’re at an age where you can get tons of advice from fellow entrepreneurs, operators, investors, and thought leaders who’ve built successful businesses.
Even if you don’t actively look for business advice, you still get it regularly via:
Social media: Twitter, LinkedIn, Reddit, Instagram, TikTok, etc.
Articles on news sites, blogs, and newsletters (like this one)
Videos you watch on YouTube or Netflix
Just talking to other entrepreneurs, friends, and your support network
That’s a great thing - people sharing their knowledge and experience empowers the next generation of entrepreneurs, and that’s a net positive for everyone.
The hard truth
Unfortunately, much of the advice you consume is irrelevant or downright harmful to your business. The advice might not apply to you, since it comes from someone with a different company type and stage, different skills and resources, serving different customers in a different industry.
Social media posts tend to simplify learned experiences into catchy, one-size-fits-all advice. This overgeneralization can lead entrepreneurs to follow others’ advice without understanding the nuance of why it worked in the first place.
Many entrepreneurs indiscriminately apply advice, rules, and best practices from people they look up to. I know I have done so many times.
Truth is, the further along a business is, the more unique its operating context is. Every decision made, every feature built, every goal set, every lesson learned. This means that the further along you are, the more context-specific the advice should be. Generic one-size-fits-all advice will likely set you up for failure.
Applying critical thinking
When you read or get advice, it's important to apply critical thinking and consider the other person’s path that has led them to give this advice.
What’s the underlying reason it worked for them, and would it apply to you?
Would it work for your company, goals, product, and industry?
Is this advice still relevant today, or have things changed?
To help you better assess the advice you get, here are 5 common pitfalls and how to avoid them:
Pitfall #1: different company stage
Advice often fails to account for the varying stages of a product or business. Strategies employed by giants like Facebook and Apple - such as doing brand advertising or building proprietary infrastructure and technologies - are often not suitable for a small startup or indie project. These companies have large amounts of cash, big teams, and can take several high-risk, high-reward bets powered by their abundant resources.
Make it a point to get advice from people one or two steps ahead of you, but not ten steps ahead of you. Before you apply any advice, ask yourself whether it makes sense for a company of your type and size, and for the kind of product you’re building.
Pitfall #2: different customer and industry
The effectiveness of product, marketing, and growth advice is highly contingent on the industry and the customer. For instance, Tinder's viral marketing strategies in the dating app space may not work for a B2B software company like Slack.
Prioritize product and marketing advice from people who work within your industry and serve the same type of customers, and ask yourself whether any product or marketing change you make would work for your customers.
Pitfall #3: different goals
The underlying objectives behind the advice you receive may not align with your goals and vision, since every business and every founder has different objectives. For example, while WeWork pursued rapid growth and market dominance at the expense of profitability, a company like Basecamp has prioritized sustainable growth and profitability over rapid expansion. You may want to build a high-touch product that serves enterprise customers, or a self-service product with minimal support and sales. Both are valid, but the same advice often doesn’t apply to both. That’s why it’s important to decide and be clear about your business goals. Ask yourself: would applying this advice get me closer or further to my goals?
Pitfall #4: overlooking timing
Having good timing is often a critical factor behind a product's success. Some companies managed to pull off amazing growth just by being at the right time, in the right place, and offering the right product.
However, markets and trends evolve quickly, and some advice that is based on last year’s experience might not work anymore. It’s possible that the market is more saturated now, customers' preferences and attention have shifted, or customers are just tired of an overused strategy.
Before applying any advice, ask yourself whether the fact that it worked for someone in the past, means that it would work for you now.
Pitfall #5: ignoring survival bias
Entrepreneurs who have tasted success often attribute their victories to decisions they’ve made, overlooking the role that luck and timing played in their achievements. This post-rationalization makes them think the strategies they used were the reason they succeeded, and they go on to provide these strategies as advice to others. In reality, many of these successes are influenced by factors beyond strategy.
10 entrepreneurs may advise you to switch from a subscription to a one-time payment model, since they had success doing it. However, there could be 100 other entrepreneurs who tried one-time payments and failed silently. Success stories are more likely to be shared, making it seem like a certain strategy works for everyone while overlooking the many times it has failed.
Avoid this pitfall by actively looking for contrarian views of people who tried the said advice and failed, then make a well-informed bet about why a certain strategy would succeed or fail for your business. It’s worth investigating why a certain strategy worked for a particular business, rather than taking the advice at face value.
That’s it folks. My goal was to give you some tools to better navigate through the heaps of advice we all get as entrepreneurs. Advice is everywhere, but not all of it fits your journey.
I’d love to hear your thoughts and perspective - please comment below.
Until next time,
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