The following answers are provided by The Young Entrepreneur Council (YEC), an invite-only nonprofit organization comprised of the world's most promising young entrepreneurs. The YEC recently published #FixYoungAmerica: How to Rebuild Our Economy and Put Young Americans Back to Work (for Good), a book of 30+ proven solutions to help end youth unemployment.
This week we asked, “What is the biggest, most significant challenge you've been presented with to date, and how you did you respond?” Their answers are below.
1. Fired From My First Startup
I started a tech company in 2009, and our growth exploded right out of the box. We grew faster than our small little mom-and-pop team could manage. Some investors made an offer to buy the company, and I jumped at the offer. I really thought their business acumen would take us to another level. Yet from the day we sold the company, I regretted it – we lost all momentum. And one day, I thought all of our social media accounts had been hacked because I couldn't log in anywhere. I called the office, and I had been fired from the company I started. It was so painful, but having that door slammed on my face caused me to be open to new ideas and better ways of doing business. I hate that it went down like that, but in the end, I learned tough lessons that make me a better businessman today.
2. Family Cofounding Gone Wrong
I've been through a business bankruptcy, but that was far from my greatest challenge. The most significant entrepreneurial hurdle for me was watching my relationship with my business partner — my cousin and best friend — go to ruin over a business dispute. Once we split, both of us realized how much we had taken the other person for granted, and we grew to have a newfound appreciation for one another. I responded by deciding that I would always put relationships first in my life. I worked to repair the damage that was done and have since re-evaluated how I balanced work and life.
3. Overcoming Market Contraction
I began my first business in 2005, which primarily served print magazines in business and interior design. A couple of years into my entrepreneurial journey, the decrease in advertising dollars and housing sales and the increase in online journalism, paper prices, and postal rates created the perfect storm in my client base. Instead of staying in a shrinking industry, I started to explore new opportunities and to cultivate an entirely new market. It took a couple of years to recover and gain traction, but now my company is positioned for growth by helping the increasing number of stressed people to accomplish more with peace and confidence.
4. Complete Employee Sabotage
This is a lesson that is unteachable in the classroom, and something that has made me a smarter, stronger business person. When your top salesperson decides to take your client list and go rogue, you've got some problems — especially when that person was one of your best friends. It really forces you to separate business and personal relationships. At the time you feel betrayed, but if you don't recognize human beings' instinctual behavior, you're only kidding yourself. This happened to me when I was running my ad network. One of my employees left with our client list of emails, and was out soliciting the business we had built over the last five years. It's a reminder that you always have to innovate and provide higher value to win service-based deals. Stay sharp and always progress.
5. Growing Too Quickly
It sounds like the best problem to have — there's more demand for what you're offering than you can fill. But the reality is really rough. I chose to go ahead and accept work, understanding that if I worked around the clock, I would only just be able to meet my deadlines. It about killed me a couple of times over. Slow and steady growth means that you're building something sustainable. My approach meant that I was scrambling to continue to grow in the long run because I was doing things that just didn't scale.
6. Combating Ethical Dilemmas
Over the course of my career as an affiliate, there have been many opportunities to make more money at the sake of harming customers unknowingly. When everyone in an industry is competing with shady tactics and pushing you to do the same, it can really put you in an interesting situation, especially when a lot of money is at stake. I decided early on that I won't cheat people or harm customers, and that I will never compromise for money. It's just not worth it. People should always trump profit. Since this decision, I've been tested many times — at some points, ethical dilemmas nearly put our company out of business — but every time I've been tested, I am glad I stood my ground and took the high road.
7. Breaking Into a Niche With a Bad Reputation
These days, people are so skeptical of any product that involves making money online. While my business isn't directly related to this market, there are components of it. The biggest challenge has been framing my marketing in a way that shows people I don't fall into the sleazy, unethical group of marketers who overcharge and underdeliver on their products. I've been able to overcome this by being brutally honest over the course of three years on my blog and through social media. Potential customers see how genuine I am with all of my dealings, and then trust that I'm not out to hurt them. And a good return policy doesn't hurt either.
8. Adding New Employees
When we went from just myself and an intern to having a full-time staff, that was the biggest challenge. Financially, it was really different because there are so many other costs to think about, such as office space, unemployment insurance, payroll services, and equipment upgrades. From a human resources perspective, that time was the biggest challenge as well because we had to implement a lot of rules and standards that I hadn't previously needed. Vacation days, flexible scheduling and, I hate to say it, but office politics became something I suddenly had to manage on a regular basis.
– Caitlin McCabe, Founder & CEO at Real Bullets Branding