My Mastermind community includes two sets of entrepreneurs—those starting a company and those scaling an existing enterprise.

I never assume people know what to do in business. What if they never ran anything while they were employees? Or what if they were not lucky enough to get into an incubator or accelerator? They might not have an MBA or have had the opportunity to read the right books. So, they genuinely need help.

Here are some of the questions I’ve been asked in my Mastermind (among others):

• What should my first two hires be?
• How do I launch a product with minimal spend?
• Do you have a step-by-step plan for the first six months of scaling a company?
• Where can I find loyal staff?

As an entrepreneur, how you answer some of these questions may mean success or failure. It could determine whether your company becomes a statistic—one of the 90% of companies that fail within three years.

Management is Not Leadership

There’s a prevailing myth that running a company is about leadership. People conflate leading teams with management and do not prepare for entrepreneurship. But management and leadership are two separate skill sets. A new entrepreneur needs management chops first.

Management is about understanding the internal workings of a company—sales, finance, operations, HR, technology, marketing, and branding—and how each function interacts to produce profitability. The most successful corporate CEOs spent time working across different functions before they were elevated to the C-suite.

In 25 years, I’ve supervised all of these functions at one point or another. For instance, I learned to read financial statements to assess my company’s profitability and liquidity. And because I understand branding and marketing, I ran the company’s social media in our first year of business, saving costs.

Without a top-level understanding of each business function, you can’t supervise your managers effectively or spot errors. People will run circles around you.

In business, regulators always hold directors responsible for compliance breaches, not their staff.

Solopreneur or Corporate?

Management aptitude helps you run a small company for a few years with just an assistant. You can outsource professional functions like legal and accounting while being responsible for quality control.

A bootstrapping company doesn’t need “structure” or “staff.” Yes, there will be key man risk, but that is only for a while, until the business becomes profitable. In the meantime, the entrepreneur must wear many hats and do lots of things alone. You need mental and physical capacity to run a business as a solopreneur. This is true even if you’re selling digital products.

The time to start building structure is when you’re ready to scale and already have sustainable cash flows. Stop blowing your money on structures you don’t need yet.

Train Your Managers?

If you lead a growing company, don’t take management fundamentals for granted or assume your team should know what to do. They will flounder without training.

As an employee, no one taught me management in a formal way, especially in sales, finance, operations, and HR. It was left to me to learn by observation and reading. That was hard.

However, the flip side is that I became an intrapreneur, taking up roles without being asked. I experimented and learned fast. My last assignment as an employee was developing all the standard operating procedures for our company. When I started Volition Cap, I used those same entrepreneurial skills.

What a Management Training Program Looks Like

To develop managers in your company, first accept that people will not learn effectively by osmosis, mentoring, or observation. In addition, sending staff for short management courses without real-life practicals is futile.

Instead, teach people the theory through courses and books, and then, for practicals, rotate them through all the functions in your organization—sales, finance, operations, HR, technology, marketing, and branding. If your company isn’t big enough for this, set aside coaching hours as a CEO to teach from experience.

Don’t presume everyone is a self-starter and will just “get it.” Teach first, and then hand them responsibility to practice.

Final Point

Learning management means people will take on more work, in addition to their day-to-day duties. They must be willing to do the hands-on work of managing others. So, only train those with the capacity for more and a desire to grow.

Thank you for reading.

Management is about understanding the internal workings of a company—sales, finance, operations, HR, technology, marketing, and branding—and how each function interacts to produce profitability.

Share on X

For more, read People and Project Management