Many times, companies that are in the software business lose sight of how to maximize their chances for success. This is especially true of companies that serve multiple market segments. Sometimes it is easier to solve the problems of one segment that is not profitable than it is to solve the issues of a more profitable market segment.

This was the subject of an email that I sent to the management team of one of our portfolio companies that is on the verge of growing exponentially in the next few months. As they begin the path of growth, they will be looking to solve problems of businesses, which is where the core of their future revenues will come. With this on my mind I sent this email:

“It isn’t the people you fire who make your life miserable, it’s the people you don’t.” Harvey Mackay

A couple weeks ago, we wrote about the importance of finding help when building your company. But sometimes when you find help, you find the wrong people. Cutting ties with a wrong-fit employee is one of the hardest things to do for any manager, but not doing it can destroy your start-up and make you miserable as Harvey Mackay mentions.

There are a few facts about hiring in a start-up:

• Some people are made for start-ups
• Some people aren’t made for start-ups
• And some people think they are made for start-ups, but they aren’t

Start-up life is hard work and has its own culture when compared to any other type of employment. A successful hire is often forced to work in strained environments without a lot of support. Some people strive in this environment, and others crash-and-burn.

As the manager/owner, your job is to determine if they are keepers or deadweight. At a start-up, you can’t be in the business of grooming talent. There are too many things to do and too many roles to fill. Cut your deadweight quickly and save yourself the headaches.

Most smart entrepreneurs are customer focused. They want to make the customer happy and get more of them. But are there times when you shouldn’t listen to customers?

This question was the topic at one of our portfolio companies, PBwiki , last week. One of the senior developers had put together a list of articles that he had read about development philosophies. The one article that caused the most interaction by the team was an excerpt from The Inmates are Running the Asylum by Alan Cooper. Most people came down on the side that you have to listen to customers to make sure you are building things that the marketplace wants. But I actually took a different twist when I sent this email:

The key message here is that you have to know who your target is and listen to those customers. Don’t think that every customer fits your target audience.

This past week I sent an email to one of our portfolio companies, PBwiki, that really demonstrated the daily grind that is life at a start-up. Every day you have to find a way to make progress and move the ball forward. Here is the meat of email:

Everyday you have to find a way to make progress. Improve your product. Improve your support. Attract that new client. Make a new line, and move the game forward.

One of the most important of Yeh’s Laws of Entrepreneurship is simple but universal:
Get someone else to do the work.

I’m not advocating laziness in entrepreneurs–entrepreneurship is hard work. But you have to realize that hard work is insufficient.

Even the most dedicated entrepreneur is hard-pressed to work more than 12 hours per day. That’s only 84 hours per week, assuming you never take a day off. And towards the end of those long days, I’ll bet our workaholic entrepreneur would be working at only 50% effectiveness–or less.

In contrast, if you simply get three reliable people to work for you 40 hours per week, that’s 120 hours of productive work, in addition to whatever you get done.

It often seems like young entrepreneurs think that working ridiculously long hours makes them morally superior. All it really makes them is tired.

Professionals work hard, but understand that the real key is figuring out how to get others to do the work.

So many times when you are at a technology start-up you get caught up in the day-to-day drudgery of trying to make incremental progress. While it is essential to make the tactical decisions and efforts, you have to understand that you are doing something great. Only in making the world a better place (no matter how small a part of the world you are affecting), will you really create value. This thought was on my mind in an email I sent to one of our portfolio companies, PBwiki, this week:

John Wooden is famous for saying, “Be quick, but don’t hurry.” Unfortunately, it’s hard to act on this Yoda-like utterance. That’s why I’ve rephrased it (glancing nervously at the sky, hoping to avoid a lightning bolt) in my own words:

Be decisive, but don’t rush in.

Sports is one of the most popular metaphors for business, along with war. Famous players and coaches can make a mint off of books and speaking engagements. The same holds true for successful generals.

But here’s the funny thing–a lot of ex-athletes and ex-coaches (as well as ex-soldiers) have failed in the business world. Not all of them–just look at the success of guys like Roger Staubach and Magic Johnson, as well as military men like AG Lafley of Proctor & Gamble–but more than the general population of folks with similar advantages (rich, famous, well-connected).

It’s not because athletes or soldiers are unintelligent; many are smart and capable. The problem is that their instincts are ill-suited to business success.

The business world operates on a different time scale than sports or combat. How often do we talk about how fractions of a second separating victory and defeat or life and death? For athletes and soldiers, reflexes and instant aggressive reaction are the keys to winning.

I’ve been in the business world a long time, and even during the era of “Internet time” I cannot recall a single instance where a fraction of a second meant the difference between success or failure.

Be decisive, but don’t rush in. It’s rare that time frames less than a day matter, and unheard of for time frames of less than an hour.

When something happens, take the time to make the right decision.

This is not an excuse for dithering…being decisive and aggressive is incredibly important to business success. But recognize that whether you respond to that proposal in 1 second or 1 hour generally doesn’t impact your options and that you can come up with a much better decision in an hour than you can in a second.

Rather than thinking of business as sport or war, think of it as chess. Every move must have its purpose. Make the right decision.

On a visit to one of our portfolio companies I was struck by the amount of progress that was being made. Every front — sales, engineering, finance, customer service, and marketing — were making daily strides. And when I left I sent the team this email:

I spent a few weeks in the HQ, and I was left with a thought of great progress. Every functional area is making great progress on building a world-class, second-to-none SaaS delivered collaborative solution. This made me think of a Latin phrase that I have used in the past: nulli secundus. This means “second-to-none” and is really the goal we have set as a company.

Often companies put their emphasis and focus on monetary goals, e.g. profitability or sales numbers. And while these are great and important, the striving to greatness is really the key. If everyone in an organization is focused on building an amazing company/product, the monetary results will follow.

“Nullis Secundus” should be the catch phrase for any start-up.

If you want to be an entrepreneur, one of the skills you must learn is how to deal with authority.

On the one hand, if you listen to advice from authority figures, you’ll never become an entrepreneur.  Too risky.  Too much of a long shot.

On the other hand, if you decide that none of the old rules apply, you’re likely to end up like the dot-bomb entrepreneurs who thought that they were immune to old-fashioned economics.

Entrepreneurs have to walk the middle path of respecting, but not obeying authority.

Respect authority for its implied wisdom and experience, but recognize that it is far from infallible.  Authority thought Wilbur and Orville Wright were insane for thinking that man could fly–even after they had done it!

Listen carefully to what authority has to say, and if you have good reasons for disagreeing, ignore it and do what you think is right.

In the end, even if you’re working within a larger company, disobeying authority can put you on the fast track to success.

Authority makes rules for a purpose–to get results.  If you get results, you can rewrite the rules.

I often hear people advising young entrepreneurs to “work harder” or “work smarter.”  While this is good advice, neither is the ultimate secret of business success.

Working harder is a good starting point.  There’s no question that all other things being equal, I’ll put my money on the harder worker.  The problem is that many people think that hard work is good in and of itself.  Not true.

I’ve known plenty of “grinds” who beavered away, expending vast quantities of effort, but without getting commensurate results.  At the end of the day, while the gritty, hard-working underdog makes for a nice story, he usually doesn’t win Superbowl MVP.

When folks realize that hard work is insufficient, they usually graduate to the next step: Working smarter.  “Work smarter, not harder” is a time-honored maxim, and yes, it is often effective.

The entrepreneur who builds a better mousetrap is more likely to catch a mouse than the entrepreneur who works hard running from mousehole to mousehole trying to catch rodents with his bare hands.

But people who truly understand success know that working smarter is still a tactic, rather than a strategy.

Those who press on past working harder and working smarter discover the ultimate secret of business success: Working on the right things.

Trying to catch mice is fine, but wouldn’t you rather devote your time to starting a company that changes the world and makes you mind-bogglingly rich than to catching mice?

I’d rather be Steve Jobs than the world’s greatest mousecatcher.  Heck, I’d rather be even a moderately successful entrepreneur like Evan Williams (the founder of Blogger and Twitter) than the world’s greatest mousecatcher.

Focusing on working harder and working smarter begs the question of judgment and prioritization.  It’s the worker-bee mentality: How can I better carry out the wishes of my boss.

When you start asking yourself, “What is the most important thing I can work on,” you’re finally taking on the responsibility of being your own boss.

Don’t go into entrepreneurship, then chain yourself to an invisible boss by focusing on working harder and smarter.

Be your own boss.  Work on the right things.