21 GOLDEN RULES

by Jason Nazar

OF ENTREPRENEURSHIP

Adapted from a speech made by Photo Credit: slimmer_jimmer via Flickr

Hello, Im Jason Nazar, the co-founder and CEO of DocStoc, a company that helps small businesses by providing them with documents, videos and articles to help them start and grow their business. Docstoc is one of the 500 most visited websites on the internet, and there have been over half a billion people in the last 4 years that at some point landed on our website. We raised $4 million for this business, and weve been growing. Im telling you this to emphasize one point: there is nothing distinguishable between me and you. Some of you may even be smarter, more athletic, more clever or more attractive than me. The only unique thing I have to offer are my experiences, and the lessons they taught me. My three goals in sharing these lessons are: Not to bore you, because I know that inspirational discourse can sometimes feel a little tired. Make you feel like your life is a little better than it was before reading this.

To help you get everything you want out of life. And yes, I actually think that this is possible, but only for some of you.

The reason this will only work for about ten percent of you is because only a handful of you will do what Im about to explain the most successful people in the world do. Only time will tell which of you go on to succeed, but for the moment, many of you are thinking the same things: Whats my life going to be like in ve, ten years from now? Am I going nd my purpose, my place? What am I eating for dinner tonight? Why did I eat that donut this morning? From the smaller to the larger picture, we all wonder similar things, and many of the bigger answers are only found in time. So let me briey pull you away from your ruminations, and offer a story about how I developed these 21 rules of on my journey to becoming the CEO of Docstoc. Whether or not youre interested in starting your own company, having a great family, doing charity work, traveling the world, building amazing relationships, leading a rich and rewarding life, or simply being rewarded for being rich, I think these lessons will help you out.

Ill See it When I Believe It

The rst lesson that I offer is simply this: youll see it when you believe it. This is, of course, a reversal on the old adage Ill believe it when I see it, which is how were trained to think: when you show people proof, then they will believe it. This is not how great entrepreneurs approach their life. Exceptional people, Exceptional people, no no matter what the endeavor is, believe matter what the endeavor it rst, and then they see it. This just means that theyre able to see in their is, believe it rst, and minds eye, with great detail, what then they see it. they want a future experience to be like. They paint a picture in their minds with such specicity, color and richness, that it becomes real. That was how I began my journey, with the feeling that I could manifest the things in my mind into reality. When I was running for student body president at UCSB, I literally walked down to the halls lined with pictures of student presidents and I imagined my face on that wall. And a couple months later, it was.

Perpetual Sense of Urgency

This drives me to my next question, which is a completely serious one: Do you ever feel like youre meant for really big, incredible things? So big, in fact, that to say it out loud almost feels embarrassing? But why does saying I want to be the president of the United States sound so silly? Somebodys going to be president, why not me? Why not you? This comes to the second quality thats always driven me, and thats a perpetual sense of urgency. I literally wake up every single morning feeling as if theres a clock of my life thats ticking down. I feel that every second passing is one less moment I have to work towards the important thing Im meant to achieve, and if Im not working towards it Im wasting that precious second. Take a moment to picture some cheesy turning point in a lm, when an old and regretful character says I wish I had more time. Sure, its sappy and clich, but this is a recurring theme in lm and art for a reason. The thought of fast forwarding fty years from now and realizing I hadnt done what I wanted to do is the most gut-wrenching prospect I can imagine. I decided in my early twenties that no matter what, I would always be willing to take a risk. Its okay if I didnt achieve everything I wanted, as long as I went after it as hard as I could.

The Only Variable You Control Is Your Work Ethic

A lot of these rules seem to require a constant, high-intensity attitude, so let me add a caveat: no one can operate at 100% all the time. For example, when I was running for student body president at UCSB, I spent up to 12 hours a day for 2 months straight doing nothing but going to every college club meeting, talking to people and putting up signs. To make time for this, I stopped going to class. Yes, I literally quit class two months because the only thing that mattered to me was winning this election. Thats because I realized that the only variable I could control was how hard I worked. Success will come to you for a variety of reasons. Maybe because youre lucky, you have good connections, or youre particularly clever. Out of all these variables, the only process you can control is how hard you work.

Most of you are not working at full capacity, and thats okay. Youre leading a life with mixed priorities, and youre only human. The important thing is to avoid being the person who, ve or ten years from now, still hasnt chosen something to give it your all. I picked something for those two months running for student president, and it worked.

Success might come to you because youre lucky, you have good connections, or youre particularly clever. Out of all these variables, the only process you can control is how hard you work.

So my next piece of advice is simply that: pick something. Whether its school (which it certainly wasnt for me), a business, a relationship, a non-prot or a hobby, just give it everything youve got.
Photo credit wili_hybrid via Flickr

The 5 Step Sales Process

After graduating college I decided I wanted to be a motivational speaker, and was forced to decide between two schools of thought on my career: The rst mistake people often make when trying to motivate and persuade other people is talking about themselves. When youre trying to sell anything, dont talk about yourself. Even as youre reading my story right now, you probably dont care about me. You shouldnt. Youre thinking about yourself. About how youre going to make money, about your love life, about your body. This is what people think about all the time: money, health and love. When youre young, you think about getting money, your appearance and romance. When youre older you think about keeping money, ameliorating your aches and keeping loved ones in your life. This is what people think about every day, and you should focus on what they are thinking. If you can talk to people about the things that are on their mind, youll always be able to persuade them. Number two, is establishing credibility. You will develop credibility both through of the things youve done, and the person you are. Are you sincere, are you straightforward, are you honest, are you transparent? Third, establish need. Establishing need actually comes more naturally to some women than men, because it requires empathy. Dont immediately give advice, but instead ask other people what they are looking for, and really listen. Learn what people are thinking, what they want, then all you need to do is reiterate what they have told you. The most important thing is that people feel like you understand their need. Once they do, they will let out a sigh of relief and say Wow, thank goodness, I cant believe someone nally understands the way I feel. Where do we go from here? In that moment, you have the ability to persuade this person in any direction, and sell them almost anything. This segues into step four, which is to offer solution that matches their need. Offer them something of value that matches what they need help with, and dont offer anything except what they are looking for. The nal step, and easy transaction, simply means saying Lets get started right away.

A) Keep my ideas and goals secret B) Tell everyone that I could

Camp A prevents the potential consequences of Camp B: people might steal your idea, or put you down. If you follow Camp B and tell the world your dreams, it could lead to humiliation if you fail to achieve them. However, by telling everyone your plans, not only do you open the possibility of making connections with people who could help you, you now have social pressure to follow through with your goals. And if you have any integrity and self-worth, youll be more likely to do it. Ive always had the desire to speak in front of people, and to teach them how to get what they wanted. In my last year of college I took a one-hour hypnosis course, which lead to two years doing stage shows. I didnt make much money, but I developed the skills that would allow me to raise millions of dollars. I later I worked under an entrepreneur who taught me how to apply my skills in persuasion to business. I learned the 5 Step Sales Process, which you can use sell a product, to sell a service or even to sell yourself to a girl or a guy:

1. 2. 3. 4. 5.

Gain interest Establish credibility Establish need Offer a solution Have a system for an easy transaction

All Effort Is Equal

After my experience in sales, I went on to business and law school at Pepperdine, and got elected once more as student body president. I spent a lot of time running clubs, studying law, and building a business plan competition launch. At 26 looked back and worried that, in spite of all my effort, I hadnt built any nancial wealth for myself. I realized, however, that all effort is equal. The same energy it takes to start a college club or plan a big event, is the same raw effort it will take to build a billion dollar business, or change the world. You may need different skills and amounts, and you may need to follow a different path, but the output of effort is the exact same. This ability to work hard and drive yourself towards something, signies the potential to do incredible things.

The same energy it takes to start a college club or plan a big event, is the same raw effort it will take to build a billion dollar business, or change the world.

You Dont Need a Product To Sell a Product

After business school, a friend and I decided to start a company together. He was worried because we didnt have experience or a product. This is the rst important business lesson I ever learned: you dont need to have a product, to sell a product. Also, there isnt a specic amount of things you need to know before youre ready to start a business. The biggest mistake people make in business is actually overestimating how much people want their service or product. Our tactic at Docstoc is to predict how many people want a product before we invest our time and money into making it. We do this by investing, lets say $10,000 to drive 20,000 users into a webpage promoting a product that doesnt exist yet. Then we observe what percentage of people who view that webpage want to buy that product. If a signicant percentage do, we build that product for them, if not we move on. As you see, you dont have to have a product to sell a product.

10 Questions to Consider When Starting a Business

During my time working in business consulting, I helped companies write business plans and prepare themselves for investment presentations. Through this process, I learned that you dont need experience or a degree to succeed, but you need the ability to sell your idea, and sell it well. After years of watching people draft and present their plans, I distilled a list of ten essential questions for every entrepreneur starting a business: 1. The rst step is to clearly describe your product or service. Describe it like you would to a fth grader, so that he would actually understand it. If you couldnt explain your product or service to a 5th grader so that he could explain it to an adult, its too complicated. 2. The second is to determine its unique value proposition. What makes your product or service different, or better? Facebook and Groupon were not the rst of their kind, but they were different and better. 3. Third, explore the market opportunity. What problem are you solving, and how many dollars are spent every year on your business category. Is the market growing? 4. Who are your competitors? What can you do better than them? 5. How will you make revenue, through subscriptions, ads, sales? Youd be very surprised how many people dont even consider how theyre going to make money before they begin. 6. Establish your team. Whos running the show? 7. What is your strategy? Strategy should simply involve asking Whats my business going to be like in 10 years from now? then breaking that down to smaller goals: what you need to accomplish in 3 months, in 6 months, 9 months, and a year. Thats it. Keep it simple. 8. How much money do you need to get the product off the ground? How much will you need to actually get people to buy it? How will you market it? 9. Create some nancial projections, how much you need, how much youre going to make; determine when and how you will become protable. 10. Decide the valuation of the company. This simply means that if youre going to give up a certain percentage of your company, how much do you want back? If you follow these questions and display your answers cleanly in a PowerPoint deck, you will have a better business plan than the vast majority of entrepreneurs that have passed through my ofce. Ive seen hundreds of businesses pitched in the last year alone, and many of them are missing some of these fundamentals.

Quick Tip: When presenting your

business plan to investors, dont use a lot of text. Investors may have years of experience and education, but ultimately they want kids storybooks. Im not kidding. They like a lot of nice pictures and graphics, a little bit of text.

Court Mentors
The nal key element of my preparation was that I constantly courted mentors. I was never the best student, but I met with successful alumni often, and socialized constantly with members of my academic and professional community. I would call up alumni and ask to meet them. I wouldnt ask for anything, a job or a connection. I just asked them to tell me their story, and then would ask them Would you consider being my mentor? They always said yes, and were attered for the opportunity. In that moment, I had established relationship where this person actually felt responsible for me in some way. More importantly, I stayed in touch with them, asked them for advice, and often took it. It was this group of people who Id asked to mentor me, that gave me half a million dollars to start DocStoc before I even had a product.

Find your WHY

A lot of people look ask the founder of successful companies how did you do it? But when youre taking on a huge endeavor like creating a business, traveling the world or starting a big project, the most important question to ask yourself is why. always going to use the what and the how as an excuse for not following through. This is so critical for any big enterprise, I will repeat it again: if why isnt constantly driving you, youll get hung up on how. Youll end up saying something along the lines of, I was going to start this business but I couldnt gure out how to do it. I couldnt raise the money. Thats not true, other people have raised the money. You just didnt have a big enough why. If you have a why, keep it close; youll need it when the goings get rough. The rst two years of running DocStoc I was in that ofce every day 15 to 16 hours a day, and today I still work on average 12 hours a day in the ofce. Anything worth working for is going to be tough.

If you dont have a big why constantly pushing you forward, youre always going to use the what and the how as an excuse for not following through.
Whats driving you? Whats your why for doing this? If you dont have a big why constantly pushing you forward, youre

Selling Ether

A lot of entrepreneurs like to talk about how they made their rst million, or their rst 100 million. What people really want to know is the very rst thing that entrepreneurs do to pull in the capital required to start making money. The answer: they sell ether. Great entrepreneurs, great leaders, great politicians and great religious gures sell ether. This means that they have the ability to a dream. If you dont have money, experience or a product, what do you have to trade? You have no currency, all you can It means you can paint a future sell is ether. It means you can paint a future experience for experience for somebody in such somebody in such specic detail, specic detail, with such substantial with such substantial intricacies that it feels tangible. intricacies that it feels tangible. When I wanted somebody to design the rst DocStoc website, I didnt have any money to give him. I had to tell this person that in a few months, he was going to get compensation, equity, and pride in creating this website that thousands of people would see in a very short period of time. I painted that picture in great detail, and then I infused it with the most important thing of all: my certainty. Its your certainty that turns ether into a tangible entity, a form of currency that you can trade with other people. This allows you to get people to do things for you before you actually have the resources to pay them in the currency theyre used to: money. Thats a lesson that every great leader, every great politician, every great entrepreneur has learned and applies on a constant basis.

Ideas Dont Matter Execution Does

In light of our growth, people have praised Docstoc as being a great idea. I dont think that Docstoc sounds like a great idea. A place where you can get documents? Thats what the internet is for! The truth is, Ive seen some ideas I thought would never work become the top businesses in the country, and Ive seen what I thought were great ideas fall apart. Ideas do not make a difference; execution does. Dont get too caught up on your idea. We all say to ourselves, Oh, I want to start a business, but I dont have a great idea yet. Dont fall into this trap of waiting for a brilliant light bulb moment.

Make It Different and Better

Looking for an idea? Start simple: Look at any successful businesses and do it differently, or better. Make sure that as you go along you can sincerely say (and actually believe) its unique and superior to what already exists. This doesnt make you unoriginal. Facebook is a social network that was different and better than MySpace. MySpace was different and better than Friendster. Google was different and better than Yahoo.

Most businesses dont succeed, not because they failed, but because they never got started in the rst place.

Even as you grow, you dont necessarily have to come up with original approaches to success. I come up with business ideas by looking at how other companies make money. I consider how I can emulate that business process, but do it different and better.

Speed and Momentum The Power of Now

Another key to success, one is harnessing the power of now. If theres something important you really want to do, you should want to do it now. This goes back to the entrepreneurs sense of urgency; if you want something, you should want it now. Speed and momentum are the only way to stay ahead. As an entrepreneur, youre running against the wind and youve got to break through the windshield. If you stop or slow down, the force of the wind will knock you down. The only way that you can get started is taking a plunge at full-speed. Most businesses dont succeed, not because they failed, but because they never got started in the rst place.

Photo credit: Kevin dooley via Flickr

Vision vs. Flexibility The Entrepreneurs Dilemma

Many successful business people are able to see things that other people dont. This actually makes their life rather difcult. When Walt Disney said he was going to build a land of animals, people thought he was crazy. In the context of their world, it didnt make any sense. Disney saw something in his head that no one else could see, and like Steve Jobs and other entrepreneurs after him, and he steadfastly pursued that vision. However, many businesses fail, and those who succeed often did so because they shifted and became a different company than what they started out as. Twitter started out as a company called Odeo that was trying to provide an MP3 music solution that nobody wanted. So the leader essentially told his team: Take two weeks, come up with a new idea, and come back to us. This was how Jack Dorsey and Biz Stone came up with an idea called Twitter. So Twitter was born as a completely new creature, a reincarnation. It wasnt the only company that transformed drastically. PayPal didnt start as PayPal. Groupon didnt start as Groupon. Hundreds of successful businesses have pivoted from where they started. This is the crux of an entrepreneurs dilemma: How, on one hand, can you be a visionary CEO who relentlessly pursues the vision only you can see, but on the other be the exible CEO whos company succeeds due to shifting? One answer is to stay attached to the problem youre trying to solve, but be very exible in the solution. A businessperson can identify a need, but the challenge comes in nding solutions. You may initially come up with impractical solutions (especially if youre a young entrepreneur), simply because you are new to this market. If you remain attached to the problem, but open-minded about how to x it, you reduce the risk of failure.

Keep It Lean
This idea is based off a great book called The Lean Startup, written by Eric Ries, who was the CTO of a chat client service. His methodology follows that in the fast-paced technology space, instead of taking long cycles of 6, 9 or even 12 months to build a product in a vacuum, you should build quick alpha products in 3 to 6 weeks and get feedback. It may have bugs, but if its an attractive product or service people will take to it, and youll get constant, realtime market feedback. You can take this method, and turn it into challenge before starting a business: If its a service-based business, ask yourself, How within two weeks, with $1000 could I start providing this service?Literally. How can you provide this service in two weeks, such that you could immediately start charging somebody for it? If youre looking to build a product, ask how could I build this in 2 months for under $10,000? Then get that product in the hands of other people, and let real people in real time tell you if they want it.

Sell Yourself First

You might be able to release a quick alpha version of your product out of your own pocket, but at some point you may not be able to continue funding your own work. I funded DocStoc as far as I could, by spending my savings and maxing out my credit card. Then I needed to reach out to my network for support. When I turned to my mentors for help, Dont Forgot: Angel and seed I kept in mind one fact: I didnt have to focus investors probably arent investing in on selling the product. When you raise your idea, they are investing in you! money, the rst thing you do is sell yourself. Your friends and family, angel investors, and the people that will give you 10, 30, 50, 100 or $250,000 for your business before its even been created, are not investing in your business. They are taking a bet on you.

Be Sincere Exceed Expectations

Keep in mind that selling yourself doesnt mean putting on a charade. In fact it means the opposite; you gain an investors trust by being transparent, sincere and honest. Tell people where you are, and what youre going to do. Set expectations, exceed them, and they will be ready to take a bet on you.

I told them when and what I would achieve, and then accomplished the goals better and faster than projected.

This is how you can get anyone to invest in you: Picture telling somebody that youre going to build a website, and you predict that in the next three months, you will have 1,000 active users. Then you come back to them in two months instead of three, and show them that you built a website that already has 5,000 users.

Ask the person what goals you should set for the next six months, and then look them straight in the eyes and tell them that you will meet those goals. Then over-deliver, once again. What reason could this person give for not taking a bet on you? Ive never once told my board a meaningful metric that I didnt over-achieve, and thats because I managed their expectations. I told them when and what I would achieve, and then accomplished the goals better and faster than projected. I will only promise things I know I can over-deliver on, and this method has never failed me.

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10 Lessons Startups Can Learn From Superheroes

When I began my company, I decided to make Docstocs core values about superheroes. Why? Because I love superheroes, and it was my company. I wrote 10 Lessons Startups can Learn from Superheroes, and expect all of my employees to live by them: 1. First, superheroes never give up. They always continue on and press forward. Batman doesnt have a single superpower, but hes superhuman because hes the most persistent human being on the planet. 2. Two, superheroes always get the job done. You never hear that Spiderman almost saved Mary Jane from the burning building. Dont say you almost started the business. You either did or you didnt. Grey area is for Kafka, not comic book heroes. 3. Superheroes are the best at what they do. When I hire people, I do it because theyre the best at what they do. Flash is the fastest. Everyone should be the best at what they do, and expect to work with the best. 4. Superheroes have a crystal clear purpose. You know Captain Marvel? Hes a young boy, and his motto is to defend good. Hes known as being a ridiculously cheesy superhero, but this clarity and simplicity of purpose is essential for business leaders. 5. Superheroes arent awless. You have aws and you will make mistakes. You will hit potholes, and earn your scars. The goal is not to be perfect, but the pursuit of perfection. 6. Superheroes dont seek the glory, but they will receive it anyways. If your goal is to achieve something important, you wont have to beat your chest and declare how amazing you are. The glory will come to you. 7. Superheroes help others. If youre starting a business, your goal should no begin with how much money do I make, but how many people can I help. Thats what superheroes think about every day, and this is what you should contemplate as a leader. When you focus on this, youll realize that there is a direct correlation between the number of people that you help, and the amount of success that you have. 8. Superheroes can do it by themselves, but theyre more powerful in teams. I dont care how talented or hardworking you think you are, you can do better by combining with other super people. Youre powerful because of the team that you build around you. 9. Superheroes real strength comes not from their powers, but from their character. Christopher Reeves is my favorite Superman because he wasnt the most muscular guy, or the best actor, but he had more character than other actors. No matter what your talents are, your true power lies in being courageous, respectful and helping others. 10. And nally, superheroes achieve huge feats. Superman spends a normal day stopping an asteroid thats hurtling towards Earth that would otherwise kill every living being. Remember that the same raw effort it takes to start a lemonade stand or plan a big event is the same raw effort it will take to literally save the world. Dont laugh it off as silly, be serious about achieving big things. Then you can at least look back and say you tried.

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The One Most Important Thing

Let me review one last thing about achieving something signicant. When it comes to accomplishing your goals, most of us get caught up in a long list of things to do. It feels good to check things off that list, and feel like youve accomplished something. However, most of the little things we do every day dont contribute to your larger goal. What really catalyzes start-ups and successful people, is beginning each day by asking: If I get one thing done today, this week or this month, what will it be? What is the most important thing in my life right now? Then write this down, and spend 80% of your time on that one task. When we rst started DocStoc, I was obsessive about our trafc. That was the most important thing to do, and it was all I thought about. Once we had a couple million people coming to the site, I turned my obsession to breaking even. I xated on nances, so that we stopped burning through our venture capital money and became selfsufcient. Once we did that, I was obsessive about how we could grow our revenue 100% per year, and build a business that would grow enough to justify venture capital investment. Today, Im obsessive about owning an entire small business category, and being the premier destination online for every single small business owner. If at any given time in your business or personal life, there is one thing that you spend 80% of your time on, it will make a huge difference in terms of overall accomplishment.

Certainty
When you set a goal, remember not just to say youll achieve it, but to really see in your minds eye the outcome youre working towards. Most importantly, infuse it with the most valuable thing you have: your certainty. Certainty doesnt come from people telling you that youre great, or any form of external validation. Certainty comes from your own belief in yourself.

Things will never be easy. The economy will uctuate, youll have tough days, and youll never be able to convince everyone of your decisions. But if Ive learned anything in my life thus far, its that if you have that certainty in yourself, you will be able to achieve everything you want and deserve.

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