How did Elon Musk become the man he is today? It’s no secret that Elon Musk built his company, Tesla Motors, from the ground up using both brains and brawn.
His business principles have made him an inspiration to many entrepreneurs and a leader in the automotive industry. To see just how he operates on both sides of the table, take a look at the business principles Elon Musk lives by every day.
Don’t do something unless you are going to be great at it. Because, if you’re not great at it, then don’t do it. You will go out there and make a lot of money and buy a yacht or make some investments or whatever, but always come back inwards towards building your company. – Elon Musk
Be Self-Reliant: The most important point when it comes to starting a business and maintaining it is that you have to be self-reliant. No one can do it for you. If you really want something, then you need to figure out how it works, and how something goes about working. – Elon Musk
Know Your Goal
Knowing your goal at all times will save you from wasting time, effort and money. Sometimes it helps to write down what you want so that you can refer back to it and make sure everything stays on track. Start with one big goal for yourself and for your business. Goals are more likely to be achieved if they are specific, measurable, well defined, realistic and timely (SMART). Make sure you know what success looks like before setting out on a journey. How much money do you need? Where do you want to live? What kind of lifestyle would let your family flourish? These types of questions help define a clear objective — and help keep your focus in check throughout implementation.
A goal without a timeline is a dream. Without knowing when you’re aiming for, you’ll never get there. Some people set very long term goals, while others set much shorter timeframes — but no matter what, they all have one thing in common: deadlines. If your deadline expires before your goals are reached, you either failed or set them too low. Either way, revisit your objectives and stretch them out for another go-around if needed. There’s nothing wrong with setting your sights high, so long as you know how to get there and how much time it might take to achieve success. But keep in mind — that even if it takes ten years to reach your primary goal, reaching secondary objectives along the way can still be satisfying and rewarding!
Plan Your Route
While nothing is set in stone, having a plan for your own business ensures you can start working toward success as soon as possible. Before you get down to creating an actual business plan, have a general idea of how you’re going to approach things. For example, will you create a partnership with someone else or start your business solo? What resources do you need and what skills do you already have? These are questions that should be answered before writing your official plan of action. It’s not uncommon for people who want to start their own businesses to fail because they either don’t know where to begin or because they expect perfection right off the bat.
Once you have a general idea of where you’re going, it’s time to put your plans into action. If you don’t already have an idea for your business, think about things you do in your spare time. Do you enjoy a certain hobby? Could that become a profitable business? Can it be scaled up and turned into something more professional? For example, take fashion designer Stella McCartney. When she was in college studying animal biology, she became interested in how leather jackets were made.
Keep Up Momentum
Don’t sit back after your first success. Keep up the momentum and you’ll find another way to succeed—which will lead to another, and then another after that. The more success you have, the easier it becomes for you and your business. As Musk has said: If something is important enough, even if the odds are against you, you should still do it. If a new business idea doesn’t feel right at first, just keep at it until it does; don’t give up too early or too easily.
Even if you’re successful, you need to keep working hard. Not only will success breed success, but if your business starts to fall behind and stagnate, it may be too late for a comeback. Keeping up momentum means continuing to look for better ways of doing things and looking at ways you can make improvements; sometimes these won’t work out but at least you’ll still be improving your business. It also means paying attention when things aren’t going as well as they could—perhaps there’s a reason why new opportunities aren’t coming your way, or it could just be a dip in customer interest; either way, try different tactics until they improve.
Don’t Rely on Luck
There’s a common misconception among people just starting out in business that they need to be at the right place at the right time. According to Musk, however, business success doesn’t depend on luck; it depends on your preparation. If you approach each challenge methodically and research all possible solutions (and their potential outcomes), there is no room for luck. By being well-prepared and taking deliberate action, you can create your own opportunities instead of waiting for them to land in your lap. Whatever happens, he says, you have to force things to happen. To learn more about how you can apply these principles in your own life or business, get access to our exclusive training here.
We’ve covered a lot of ground so far, but you can sum up all of these principles in one word: preparation. If you approach every situation with a thoughtful plan, execute that plan diligently and never give up, you’ll be able to reach your goals no matter what obstacles stand in your way. Remember, nothing happens by accident. You have to create your own opportunities for success and take action when those opportunities arise; there’s no such thing as luck.
As a business owner, you have to be bold and willing to take risks. When your company takes risks, those risks can lead to great opportunities and valuable lessons. If you aren’t taking risks, chances are someone else will come along and take them for you, leaving you playing catch-up instead of being first in line for some of these incredible opportunities. Taking calculated risks makes for stronger businesses. The more experience you have under your belt when it comes to risk-taking, however, the easier it will be in terms of minimizing risk—and maximizing growth potential. One way you can gain experience with risk management is by participating in discussions on online forums like Reddit’s Entrepreneur subreddit or Quora.
When you’re first starting out, it can be tough to know what risks are smart and which ones aren’t. This is where online forums can come in handy. There, you can find answers from business owners who are successfully taking risks—and avoiding risky ventures. Not only will participating in these forums give you a glimpse into how other companies operate, but you may also get valuable feedback on your own business ideas as well. Whatever your strategy for taking smart risks, remember that taking risks isn’t about jumping into every opportunity with reckless abandon. It’s about doing your homework and being prepared for success when an opportunity presents itself—or when circumstances make one necessary for survival.
Learn From Failure
From day one, Tesla operated on the principle of starting small and growing big. Initially, it planned on selling only electric vehicles that could go 200 miles between charges and would have a price tag of $60,000 each. In contrast, cars like BMW’s 3 Series sedan would cost around $30,000 after all taxes were paid. Instead of designing a vehicle for people who could pay top dollar and drive their cars for three years or more before replacing them with something newer, Tesla targeted an audience looking for high-end replacements every few years — an entirely different market niche. Keeping overhead low meant Tesla was able to develop its technology affordably and focus on quality rather than profits in its early days.
Most companies fail because they aim too high, invest in things they don’t need and grow before they know what they’re doing. It’s important to remember that when it comes to business, small is often better. Focus on creating something people will pay for instead of trying to reach a big audience. If you have a great product or service and can charge a premium price for it, you won’t have any trouble finding customers. Once you develop an initial customer base, focus on improving your products and services so your existing clients will stick with you long-term and be loyal referrals for new ones. These are sustainable practices — not just in terms of cash flow but also in revenue growth over time.
Start Small and Get Bigger
If you’re starting a business, it’s tempting to think about how big you’ll get. What if you get really big? Will I have enough money? Is it worth it? But that’s not how startups succeed. Startups succeed by making something small and then making it bigger over time—like SpaceX, whose first rocket was pretty small compared with what they make now. The same goes for Tesla and its first electric car—it wasn’t very good but they managed to make improvements. If your dream business can start out as a side project in your day job, so much the better! You’ll save on startup costs and also get instant feedback from potential customers about what does and doesn’t work about your idea.
Decide what you’re going to make and how you’re going to sell it. You’ll likely have a lot of ideas bouncing around in your head, but at some point, you need to decide what’s feasible and worth pursuing. Just go for something easy. Look at all your options but choose just one—at least at first. It’s easier to focus on one product or service than everything all at once, so pick a single aspect of your business idea, like developing an iPhone app for taxi service instead of creating an entire cab company from scratch! Just start with making and selling something small rather than trying to tackle everything all at once. This way, even if you fail, you’ll still get something done.
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