In the very first episode of my new podcast (make sure you subscribe!), I’m going to show you the specific coping strategies I’ve used to deal with 3 huge setbacks in my career as a founder.
First, how I dealt with losing $1,000,000 of my own money in a failed company I launched back in 2015. Second, how I dealt with losing a 9-figure deal to sell one of my companies at the last minute. Finally, how I dealt with the death of an employee and a close friend.
The best founders develop rock solid mindsets and can weather the storms and that’s what I’ll teach you how to do in this episode.
Okay, hey everyone Mitch Harper here. Welcome to episode one of my new podcast, which I am calling “How to Deal with Sh*t” as a CEO.
Now, whether you’ve experienced it or not, eventually you will run in to challenges. You can have small challenges, or you can have really, really big seemingly insurmountable challenges that can just stop you in your tracks. I’ve had this happen to me quite a few times over the last 15 years running my various companies.
And so, what I thought we’d do with episode one is kick off with a few ways that I’ve learned to deal with big issues, big tragedies, traumas, setbacks, in the context of business. But also in the context of your personal life, and give you seven, eight, nine tips to help you work through them as well.
I’m a big believer that if you’re patient and if you cultivate the right mindset, you can work through most challenges, not all of them, but most of them. So that’s really what I wanted to cover in episode one, but before we get into that, why don’t we talk a little bit about why I started the podcast.
Now, if you’ve been following me for a while, you would know that I write regularly, about once a week on Medium. I’m a LinkedIn influencer, I live stream on Facebook about once a week as well and we get, you know a thousand people on each of those, and it’s a lot of fun and I get to help a lot of followers. And, the reason that I really launched this podcast is because I want to seemingly be everywhere, all the time, and that helps me achieve my mission which is to directly impact the businesses of one million entrepreneurs within the next ten years.
So, if you’re listening to this hopefully I can give you a whole lot of value both in this episode and through the entire podcast I’ll be looking to record about one episode per week. Probably keep them to 10 or 15 minutes in length, short, punchy, really actionable advice. Everything will be really applicable to your business and where you are now and hopefully we can help you get that growth that I know you’re looking for.
You know, when I got started, building a company was a lot of trial and error. We made a lot of mistakes in my first three companies, and then started to figure things out as I got into company four. And then, by the time I got into company four, five, six, seven I thought I had it all figured out and then two companies ago, actually.
The company was called People Spark, you guys may remember it. I actually shut that down, after less than a year. And, I’d invested about a million dollars of my own money, which I’d taken from one of my previous companies. I was talking to investors, had three term sheets on the table, and I decided to shut the company down. And, the reason for that really was, that, we had a great product, and we were achieving product market fit, but my passion is small businesses.
Small business owners, teams inside of small businesses, and we realised that the product was great, but for larger more enterprise type clients which is not where my DNA is a founder. I’m a product guy, I’m a marketing guy, but I love to serve and help small businesses, entrepreneurs, founders and marketers, not large companies.
And so, we decided to pull the pin on that, and that was really hard for me, because, I’d done a huge amount of PR, public relations, and been on the front cover of magazines, and, you know, Fast Company, and Sydney Morning Herald, which is here in Australia, and Ink Magazine, and TechCrunch and all of these different sites. And I decided to pull the pin because we had a semblance of a product market fit but it wasn’t the market that I wanted to be serving.
And so, that’s one example of when, you know quote, unquote, I lost, not everything, I’d had a lot of success in previous companies but anyone losing a million dollars that they put in of their own money, I don’t care how much money you have, it’s a lot to lose, within a twelve month period. And that was for covering the cost of the product team, the engineering team, the design team, some marketing, and everything like that.
So, when we got traction, I ultimately decided to shut that company down and the other nine lessons that I’m quickly going to walk you through on this first episode of the podcast are really what I came up with when I was reflecting on shutting people’s Spark down.
There’s another really big incident, I guess, for me that made me stop and focus, and learn how to deal with hug setbacks, and a few years ago we were about to sell one my companies for nine figures. Actually high nine figures, and that deal fell through at the last minute, and like every great entrepreneur, I knew the percentage of the company I owned and it was very large, and I calculated how much money I would make in US dollars and I converted that to Aussie dollars because I’m Australian if you can’t tell. And I started dicing up that money between investments in my next company, and contribution, and holidays, and you know, all that fun stuff, the material stuff. The cars, the watches, the boats, all of that and that deal fell through at the last minute, and that was generational wealth.
That, through no fault of my own, unfortunately, slipped through my fingers, and so, I had to come to terms with that, and chart another path. Luckily, everything worked out, because I did learn how to be patient and learn that set backs happen along the way. And again, the lessons that I’m going to quickly walk you through in this episode really helped me get through that situation.
SO, the first one, is shutting down a company and losing a million dollars of my own money. And then the second one, having to come to terms with losing a deal through no fault of my own, I’d done everything in my power to make the deal happen. It was very close, and not pocketing what would have been nine figures. So yeah, two fun situations that I haven’t actually spoken about publicly, and that’s what I want to do on this podcast. I want to take you, kind of, behind the scenes and show you some of the experiences, both positive and negative, fun and confronting that I’ve had In the last 15 years of my entrepreneurial career, and help you overcome those and prepare you for those if they do happen to you.
Let’s go through some things that I learned after those two setbacks, and after really reflecting on what happened and how I wanted to move forward. The first thing I always do when I think something negative or unexpected is going to come up is, do a best-worst probable case analysis. Especially when I’m weighing decisions where there’s a decision I might take that could be a home run, but has a huge amount of risk associated with it. I like to really keep it simple and look at what is the best case that could happen, and think about the percentage chance out of a hundred, that that will happen. Do that for the worst case, so think about what that would actually mean, and write down a few bullet points, think about the chance out of a hundred that it will happen, ten percent, five percent, 30 percent. And then also do that for the probable case because, what I tend to find and I’m sure you do to, sis the worst case rarely ever happens, probably less than two percent. And that doesn’t matter whether you’re talking about business, personal, anything like that.
It really is sub-two percent in my experience. But probably case happens, you know 80 percent of the time, and then maybe the best case happens about 18 percent of the time. So I like to do that best-worst probable case analysis and I actually like to prepare myself for the worst case. And I like to get comfortable with the worst case. And, if I can get comfortable with the worst case, I know this sounds little bit pessimistic but it’s of reverse psychology, If I can get comfortable with the worst case, then anything that happens that isn’t the worst case is upside. Which is the probable or best case. And if the worst case does happen, I’ve prepared myself psychologically and emotionally for that to happen, and I’ve already got the plan in place to deal with the worst case.
So that’s kind of the worst thing I like to do. The second thing is that, when I am going through tough times, when something hasn’t gone how I wanted it to, or something comes out of left field and just knocks me for a six, I like to focus on making huge progress specifically in the context of the business. And that can be really on anything, but it should be on something that moves the needle forward for the business, and that’s tied back to growth.
That’s what I like to do. The third thing I like to do is knowing when to step away. So we can get so caught up as entrepreneurs running our business. You can sit at your desk, I’ve done this thousands of times, you sit down at maybe seven or eight a.m. and then by the time you look up it’s eight or nine p.m. and you wonder where the day went. And maybe you were distracted, ,maybe you were so focused on the negative aspect of a challenge that you just lost track of time.
So then, one thing that’s really important to cultivate is knowing when to step away. And what I do today is, I have pre-planned, pre-paid, pre-booked, holidays in my calendar every eight weeks. And they force me to get out of the office and stop running the business. To get back to that ten thousand [inaudible 00:09:09] view, and most importantly to do my best, it’s not always possible, I’m always on, I’m always thinking about the business, but to do my best to spend time with my wife and my two little girls and just have fun. Eat some nice food, go to another country, hang out, just relax and really focus on the important things in life because, you never want to be the richest guy in the cemetery, right?
I’m sure you’ve heard that saying, so, it’s important to grow your business and work hard and focus, but you never want to do that at the cost of, number one, your mindset, and your stress levels, and number two, your family as well. So knowing when to step away. So, I have those holidays in my calendar every eight weeks, and then if I find myself focusing on something and not making good progress, I’ll just walk away. Now for me walking away means going to the gym, I’m a huge believer in the mental benefits and the stress reduction benefits of exercise. My routine, I won’t get into it too much, but I like to do four weight sessions a week and then three hit sessions a week.
So, high intensity interval training, which for me is, at the moment, sprints on a treadmill, or skipping 30 seconds as hard as you can 30 second rest repeat that for thirty minutes. And I had to work my way up to that. With the weights I just do a normal pull push split four times a week, really simple stuff. I am a big believer that proximity equals routine when it comes to fitness, so one of my big goals for many years was to build professional grade gym in my house. Which I have been fortunate enough to do. Did that last year and I’ve been in the gym six days a week ever since, because the gym is here and there’s no excuse not to walk down 15 stairs to the bottom level of my house and exercise.
There’s a TV in there, there’s a Mac, there’s speakers, there’s lots of beautiful natural light, there’s all professional equipment for everything and it makes it really easy to stick to. So that’s how I step away when I’m trying to make progress on something, but I’m just coming up against the wall. Really important stuff.
The fourth thing that I would say is to talk to someone and get advice. And that’s kind of a “duh” kind of statement. Of course when you have a problem you should get advice. I always think about a marriage. When you have a problem in a marriage if you’re a first time husband, or a first time wife like I am. My wife and I have been married for about six or eight years now. We have been together for about eleven years.
You know, just like building a company, with a marriage, if you’re going through it for the first time you don’t know what to do, you don’t know what to expect, so you go and get some help. You might go and see a marriage counsellor, you might see a therapist, you might research and read articles. It doesn’t mean your marriage is bad, the best time to actually get help and advice is when things are good, because if they turn bad, then you’ve got some tools that can help you get through those situations.
And too me it’s the same with building a company. SO, ideally before things really hit the fan, right, before the shit hits the fan, go and talk to someone and get some advice. That was one of the big reasons I set up Inner Circle, which is my little private mentoring group. We have, approaching 100 founders now, a few dozen founders, we do it on Slack and we do two live webinars a month. And, it’s really to help them with the challenges they experience before they actually experience them.
Another site that I like to use is Clarity.Fm, C-L-A-R-I-T-Y.F-M. Dan Martell started that and started off, he’s a great entrepreneur. Clarity.Fm, lots of domain experts on there that you could get advice from. And the other kind of source of information and just, kind of back an forth for me is my wife. I like to tell my wife my problems in the business and because she’s an outside perspective because she’s not an entrepreneur, she can normally give me some really interesting, you know, kind of perspective and advice on the challenges that I’m coming up against. And I can use that to make progress.
So definitely knowing when to talk to someone and get some advice. The worst thing we can do as entrepreneurs is assume we have to take the journey on our own if we’re a solo founder. So, definitely gaining some advice.
Number five, is to ignore your competition. I really believe in putting your blinders on and going straight for your vision. Now, you’re going to have competitors that come out of no where. You’re going to have the big companies of the world, the incumbents in your space are going to launch something that competes directly with you, because they’ve seen what you’re doing and they want a piece of that market. Your competitors are going to launch all of these crazy new features, or products, or services, or they’re going to crush you on price.
All right, I’m a huge believer in ignoring your competition and focusing directly on the pay and point of customers in your market. If you can empathise with your customers better than your competition. If you can articulate, understand and solve, their pain points or pain points better than your competition then you build a bond with them. You build an emotional bond, which creates a brand. A brand is a defensible asset that’s very hard to replicate.
So, I’m a big believer in ignoring what your competition does, and I’ve been guilty of this in the past. I’ve looked at competitors who have raised a 100 million dollars when we’d only raised, you know, 20 and I thought, “Wow they raised five times more than us, they’re going to grow five times faster than us”. Or, I’ve lost a big client to a competitor and I start thinking, “Oh man maybe our product isn’t that great if they chose that competitor over us”. The key is to know that competitors will come and go, but it’s that focus on living your vision and executing against your mission, and solving problems in the best way that you know how, and that you’re capable of, for your clients.
That will help you not only win, but essentially realise, competition exists in any market and it’s part of the game. If you are in a market without competitors, I will show you a market that will be dead in a few months, and your company will shut down. SO you’ll always have competition the key is not to react to, or pay to much attention to them.
Now the sixth thing I like to do when I’m dealing with shit is, to watch motivational videos from founders who have either experienced and overcome the challenges that I’m going through, or that have built their company to the point that I want to be at in three or five years from now. When you look back over big challenges in your entrepreneurial career, excuse me, you’ll realise that at the time as you’re going through them they seem like insurmountable, huge things to get through. But when you look back on them, you’ll realise they weren’t actually that big. And the big key to becoming a better founder or running a company that’s doing five, ten, 20, fifty, a hundred million revenue, is to realise that problems don’t actually go away. They actually get bigger and more complex.
But your problem muscle, if you like, gets bigger and you get bigger at solving larger problems. Primarily through delegation to your leadership team, if you don’t have one now, once you build one you will, and they’ll help you with that. But you get better at solving more complex problems. They don’t go away. So, I always like to do a model, which essentially means copy, it’s a Tony Robbins term, model what other founders or entrepreneurs did to handle those challenges when they were in the same or similar situation.
But the seventh thing that I like to do, we’re almost done, is compare your life today to where it was five years ago. Now if you’re like me and constantly striving to set bigger goals, and hit those goals, and knock it out of the park and help your employees become better, and help your customers, and grow, grow, grow, you’re obsessed and you’re a learning machine. Then, I know for a fact that your life today will be dramatically different than what it was five years ago.
So if I look at the date here, it is June 13, 2017. So if I think about my life five years ago, as an example, very easily for me it goes back to my little girls. We didn’t have our girls back then, neither of them were born. Now, today one of them is three and one of them is one. So I just think about the happiness that’s been brought into my life, by my daughters being born. And for me, that’s enough. Right, outside of business, outside of material things, outside of experiences, outside of contribution.
For me, that is my catalyst, that is my motivation every single day. And when I think about, five years ago, my wife and I were happy, we were having fun, we were travelling a lot. I was running a huge company at the time, doing well financially all that kind of stuff, but none of that matters in comparison, to having my two little girls. Which I have today that we didn’t have five years ago. So find the thing in your life today that you didn’t have in your life three, you know, five seven years ago, and really focus on that. Go and spend time with those people, if it’s your kids, go and spend time doing that hobby, if it’s a hobby.
Go and spend some of that money maybe you have now that you didn’t have five years ago on something that will make you happy. And really just focus on how great your life is today compared to five years ago.
Now the second to last thing, is to realise that it takes seven to ten years to make anything that is truly great. If you want to build a lifestyle business or a side business, that can take a few months, I’m talking about if you want to build a company, a brand, a legacy, that outlasts you. That has the potential to impact tens of thousands, hundreds of thousands, millions of people, that takes seven to ten years. Now, I know when I started building my companies I would think, two to three years was enough time to be the next Google, right, or to be the next Virgin. But, in reality the first three years are really just finding your feet, I don’t care if you’ve raised money, if you’re bootstrapping, if you’re in technology, if you’re an agency, if you’re in retail.
The first two or three years, and if you ask any successful entrepreneur they’ll tell you this too, is finding your feet. Who are we selling to? What are we selling? How are out margins? Do we hire? If so, when? Do we need to raise money? If not, how do we fund the business? That’s the first two or three years. So if we said the first three years is finding your feet, then you’re spending four maybe seven years actually scaling the business. Which, is not that long, in retrospect when you look back.
So, it does take seven to ten years to make a truly great business. And one of the constant themes in my life whether I’m living it, and reminding myself, whether I’m teaching it to other founders in a circle, whether I’m writing on Medium or doing a podcast like this, is that patience separates great transformational entrepreneurs from those you’ve never heard of, that never make an impact on the world, because they give up to early.
Things get hard, they don’t know what to do. It’s easier to throw in the towel and go back to their job or do something that’s more of a lifestyle business than a big impact business. So really if you just started on this journey of building a company, if you’re on year one or year two, dude, you’ve got five to eight years to go. Like I said, just realise that you’re in the embryonic stages. If you’re five or six years in, you may have another four or five years to go, if you want to make something big. And if you don’t that’s completely okay as well. But I know for me when I start a company, I’m incubating a SAS company right now and we’re about twelve months in, I’m planning what are we going to be doing in 2026. Which is nine or ten years from now. That’s the kind of planning and foresight you need to build a big, sustainable company that impacts hundreds of thousands or millions of people.
Now the final thing is to, point number nine, and the last point that I wanted to talk about in episode one of this podcast, is to go to you’re vice regularly. Now, your vice can be anything, for me it’s exercise. It’s my kids, it’s my friends, it’s food, it’s travel. I have a lot of different vices. It’s writing, writing for me is very cathartic. I really just love to write and just bang out 5000 words, 2000 words in fifteen or twenty minutes on the keyboard. And, whether I publish it or not, it’s one of the vices I go to. You need to know when to step away and when to call it a day, and when to realise that you’ve given the problem at hand everything you’ve got. And that you don’t have anything left to give in this particular moment.
And instead of walking away and taking on a destructive behaviour, or habit like drinking, over eating, like whatever, video games. Actually video games are a good vice for a lot of people. Not for me, but for a lot of people. You need to have something that you can go to. One of my coaches a long time ago, she got me to actually create a menu of vices. And it was a list of 10 or twenty things at the time that I could go to to relax, to turn my mind of, to just chill out. And they can be anything you like. Ideally they’re non destructive, so don’t put drinking on there, don’t put over eating junk on there.
Make them things that are fun and relaxing that aren’t harmful. Playing video games, exercising, talking to your wife or husband, doing that other thing we like to do with our wives and husbands, right. Taking your kids to the park, walking your dog, trying a new restaurant, going for a walk. Whatever it is, like, spending money is okay, if it makes you happy, it makes me happy when I spend money sometimes. Makes my wife happy when she spends my money.
Anyway, definitely go into your vice regularly. It can be once a day, sometimes, once a week. I tend to find that when I’m in tough situations I need to force myself to go to one of my vices more regularly to really help me cope with and get through those challenges. But, the thing to focus on is, really what’s the worst thing that can happen. Once you understand that, as I mentioned at the top of the podcast, and once you come to terms with that, and once you know the probability of that is sub two percent, sub five percent, you know, you kind of accept it an you deal with it.
And you say, “I know that if the worst case happens, I’ve got this plan in place, but I’m going to focus on the probable, or the best case outcome here. An I’m going to do some of the things that Mitch spoke about on that podcast, to deal with the shit that I’m currently going through. And that will get you through most things. It’s gotten me through, as I mentioned, losing a million dollars and shutting down a company, losing a deal that was worth to me personally nine figures, having someone very senior at one of my previous companies pass away unexpectedly and not knowing how to deal with it. Not having an employee pass away before.
These kinds of things, they tug on your heart strings. They make it incredibly difficult to compose yourself as a founder, as an entrepreneur. But if you can deal with those challenges and weather the storm and be patient and have coping mechanisms in place like the nine things that I’ve told you on this podcast, you’ll be surprised at just how little you have to do to build a big enduring company.
Of course you still have to put in the work, you still need great products and services. You need a great team. You need great marketing, all of that stuff. But sticking with something, I believe is 80 percent of getting a result that you want.
Tony Robbins always says, “Success is 80 percent mindset 20 percent mechanics”. 80 percent of the mindset is how you deal with things like stress and issues and everything that comes up. And the 20 percent, what Tony means by mechanics is the functional, strategic, tactical things, or what I call stuff that you have to do in your business to sell more, to grow your revenue. To hire people, all of that stuff. That stuff is easy, all of that stuff you can find on Clarity.Fm, YouTube, U&Me, other great podcasts by other successful entrepreneurs.
It’s all out there. That’s all just tactical stuff. But if you can get your mindset right and deal with challenges you’ll already be in the top one percent of founders in the world. I know that for a fact. I’ve coached a lot of founders one on one. I see a lot of founders in my Inner Circle, which as I mentioned is my private community for founders, and the ones that have that rock solid mindset, that can deal with anything that is thrown at them, they grow insanely successful businesses that give them their life back. Give them the financial resources to do what they want and of course the channel through which they can impact positively thousands, or millions of people, either through their products, or services, or through some contribution that comes as a result of the financial gain they’ve experienced from that business.
So, that’s what I wanted to cover in episode one. How to deal with shit as a C.E.O. Please make sure you rate this podcast on iTunes or Stitcher or wherever you happen to be listening. A five star rating would be great. If you found it helpful, any rating if you didn’t with a comment to tell me why would be helpful a well, and I will come to you next week with episode two.
Thanks for listening. Make sure you check out my blog at mitchellharper.me/blog. Go ahead and subscribe and I will catch you on the next episode. Take care.
If you enjoyed listening to this podcast, you have to come check out Inner Circle. It’s my monthly coaching programme, where we take all this material and we apply it into your business. We take it to the next level and actually study it together. You’ll learn how to build your business faster, how to avoid mistakes, and most importantly, how to make your entrepreneurial journey fun.
Join me over at mitchinnercircle.com. I would love to have you on board, and I’ll see you there.
|About Mitchell Harper
Mitch is a 7x company founder, advisor and investor. He is best known as the co-founder of BigCommerce. His companies have generated over $200,000,000 in total revenue and he is currently building an online education company and a SaaS company.