The 100 Rules for Being an Entrepreneur

Rules for being an entrepreneur

If you Google “entrepreneur” you get a lot of mindless cliches like “Think Big!” For me, being an “entrepreneur” doesn’t mean starting the next “Facebook”. Or even starting any business at all.

It means finding the challenges you have in your life, and determining creative ways to overcome those challenges…

So if creating new income streams is a challenge for you…

I’ll give you a free income idea, I know more than a few people making money this way…anyone can do this, no special skills required!
I’ll Tell You What To Do – Click Here


I believe that creating multiple income streams is important for everyone.  However, in this post I focus mostly on the issues that come up when you first start an actual company.

These rules also apply if you are taking an entrepreneurial stance within a much larger company (which all employees should do).

Just as good to be an “entreployee” as an “entrepreneur”. Either one will help you survive this world of increased economic uncertainty.

For me, I’ve started several businesses.

Maybe 17 have failed out of 20. I fail quickly. I fail frequently. Entrepreneurship is a sentence of failures punctuated by brief success.

I’m invested in about 28 private companies. I’ve advised probably another 50 private companies. I’m on the board of several private companies and one public company. The companies ranging from $0 in revenues to a billion in revenues.

Along the way I’ve compiled a list of rules that have helped me deal with every aspect of being an entrepreneur in business and some in life.

Here’s the real rules:

A)        It’s not fun. I’m not going to explain why it’s not fun. These are rules. Not theories. I don’t need to prove them.

But there’s a strong chance you can hate yourself throughout the process of being an entrepreneur. Keep sharp objects and pills away during your worst moments. And you will have them. If you are an entrepreneur and agree with me, please note this in the comments below.

B)        Try not to hire people. You’ll have to hire people to expand your business. But it’s a good discipline to really question if you need each and every hire.

C)        Get a customer. This seems obvious. But it’s not. Get a customer before you start your business, if you can.

So many people say to me, “I have an idea. Can you introduce me to VCs?”

There is a HUGE gap between “idea” and “professional venture capital”.

In the middle of that gap is “customer”.

D)        If you are offering a service, call it a product.

Oracle did it. They claimed they had a database. But if you “bought” their database they would send in a team of consultants to help you “install” the database to fit your needs.

In other words, for the first several years of their existence, they claimed to have a product but they really were a consulting company. Don’t forget this story. Products are valued higher than services.

And almost EVERY major software product company was a service company in the beginning. Don’t forget that.

E)        It’s OK to fail. Start over. Hopefully before you run out of money. Hopefully before you take in investor money. Or, don’t worry about it. Come up with new ideas. Start over.

F)         Be profitable. Try to be profitable immediately. This seems obvious but it isn’t. Try not to raise money. That money is expensive.

G)        When raising money: if it’s not easy then your idea is probably incapable of raising money. If its easy, then take as much as possible. If its TOO easy, then sell your company (unless you are Twitter, etc).

(if its too easy, sell your company)

H)        The same goes for selling your company. If it’s not easy, then you need to build more. Then sell. To sell your company, start getting in front of your acquirers a year in advance. Send them monthly updates describing your progress. Then, when they need a company like yours, your company is the first one that comes to mind.

Don’t be like that guy in the TV show “Silicon Valley”. If someone offers you ten million for a company that has no revenues, then sell it. Not everything is going to be a Facebook. And even the Google guys tried to sell their company for ONE MILLION DOLLARS to Yahoo before they were revenue positive.


I)          Competition is good. It turns you into a killer. It helps you judge progress. It shows that other people value the space you are in. Your competitors are also your potential acquirors.

J)         Don’t use a PR firm. Except maybe as a secretary. You are the PR for your company. You are your company’s brand. You personally.

I’ve never had a good PR company. I’ve had good PR secretaries. But they are cheaper. One time I hired a PR company and they accidentally sent me the contract for Terry Bradshaw. He was paying $10,000 a month. How did they do for him?

K)        Communicate with everyone. Employees. Customers. Investors. All the time. Every day.

Employees want to know what to do. And they want to know you are thinking of their overall career.

Customers want to know how to keep their bosses calm.

Investors want to be your friend and want to know they can count on you when time’s are tough.

L)         Do everything for your customers. This is very important.

Get them girlfriends or boyfriends. Speak at their charities. Visit their parents for Thanksgiving. Help them find other firms to meet their needs. Even introduce them to your competitors if you think a competitor can help them or if you think you are about to be fired. Always think first, “What’s going to make my customer happy?”

Note: EVEN if that means introduce them to a competitor. If you are the SOURCE, then everybody comes back to the source.

M)        Your customer is not a company. There’s a human there. What will make my human customer happy? Make him laugh. You want your customer to be happy.

N)        Show up. Go to breakfast/lunch/dinner with customers. Treat.

O)        History. Know the history of your customers in every way. Company history, personal history, marketing history, investing history, etc.

P)         Micro-manage software development. Nobody knows your product better than you do. If you aren’t a technical person, learn how to be very specific in your product specification so that your programmers can’t say: “well you didn’t say that!”

Q)        Hire local. You need to be able to see and talk to your programmers. Don’t outsource to India. I love India. But I won’t hire programmers from there while I’m living in the US.

R)        Sleep. Don’t buy into the 20 hours a day entrepreneur myth. You need to sleep 8 hours a day to have a focused mind.

If you are working 20 hours a day, then that means you have flaws in how you are managing your time. You can argue about this but it’s true.

S)         Exercise. Same as above. If you are unhealthy, your product will be unhealthy.

T)         Emotionally Fit. DON’T have dating problems and software development problems at the same time. VCs will smell this all over you.

U)        Pray. You need to. Be grateful where you are. And pray for success. You deserve it. Pray for the success of your customers. Heck, pray for the success of your competitors. The better they do, it means the market is getting bigger. And if one of them breaks out, they can buy you.

V)       Buy your employees gifts. Massages. Tickets. Whatever. I always imagined that at the end of each day my young, lesbian employees (for some reason, most employees at my first company were lesbian) would be calling their parents and their mom and dad would ask them: “Hi honey! How was your day today?” And I wanted them to be able to say: “It was the best!” Invite customers to masseuse day.


W)       Treat your employees like they are your children. They need boundaries. They need to be told “no!” sometimes. And sometimes you need to hit them in the face (ha ha, just kidding). But within boundaries, let them play.

X)        Don’t be greedy pricing your product. If your product is good and you price it cheap, people will buy. Then you can price upgrades, future products, and future services more expensive. Which goes along with the next rule.

Y)        Distribution is everything. Branding is everything. Get your name out there, whatever it takes. The best distribution is of course word of mouth, which is why your initial pricing doesn’t matter.

Write a blog about your industry and be very honest about all the flaws (even your own) that is currently in your industry.

Authenticity is the best branding.

Z)         Don’t kill yourself. It’s not worth it. Your employees need you.

Your children or future children need you. It seems odd to include this in a post about entrepreneurship but we’re also taking about keeping it real.

Most books or “rules” for entrepreneurs talk about things like “think big”, “go after your dreams”. But often dreams turn into nightmares. I’ll repeat it again. Don’t kill yourself. Call me if things get too stressful. Or more importantly, make sure you take proper medication

AA)     Give employees structure. Let each employee know how his or her path to success can be achieved. All of them will either leave you or replace you eventually. That’s OK. Give them the guidelines how that might happen. Tell them how they can get rich by working for you.

BB)      Fire employees immediately. If an employee gets “the disease” he needs to be fired. If they ask for more money all the time. If they bad mouth you to other employees. If you even think they are talking behind your back, fire them.

The disease has no cure. And it’s very contagious. Show no mercy. Show the employee the door. There are no second chances because the disease is incurable.

I don’t say this because I want anyone to be hurt. But if you’ve followed the rules above then you are treating employees well already. NOBODY should spread the disease and badmouth you or your customers.

CC)      Make friends with your landlord. If you ever have to sell your company, believe it or not, you are going to need his signature (because there’s going to be a new lease owner)

DD)     Only move offices if you are so packed in that employees are sharing desks and there’s no room for people to walk.

EE)      Have killer parties. But use your personal money. Not company money. Invite employees, customers, and investors. It’s not the worst thing in the world to also invite off duty prostitutes or models.

I don’t say this in a sexist way. It’s just the reality of what happens with every company in the world.

FF)       If an employee comes to you crying, close the door or take him or her out of the building. Sit with him until it stops. Listen to what he has to say. If someone is crying then there’s been a major communication breakdown somewhere in the company. Listen to what it is and fix it. Don’t get angry at the culprit’s. Just fix the problem.

(you don’t want your employees to be sad.)

GG)     At Christmas, donate money to every customer’s favorite charity. But not for investors or employees.

HH)     Have lunch with your competitors. Listen and try not to talk. One competitor (Bill Markel from Interactive 8) once told me a story about how the CEO of Toys R Us returned his call. He was telling me this because I never returned Bill’s calls. Ok, Bill, lesson noted.

II)        Ask advice a lot. Ask your customers advice on how you can be introduced into other parts of their company. Then they will help you. Because of the next rule…

JJ)        Hire your customers. Or not. But always leave open the possibility. Let it always dangle in the air between you and them. They can get rich with you. Maybe. Possibly. If they play along. So play.

KK)     On any demo or delivery, do one extra surprise thing that was not expected. Always add bells and whistles that the customer didn’t pay for.

This is such an easy way to over deliver I’m surprised people don’t do it 100% of the time. They do it maybe 1% of the time. So this is an easy way to compete and surprise and delight.

LL)      Understand the demographic changes that are changing the world. Where are marketing dollars flowing and can you be in the middle. What services do aging baby boomers need? Is the world running out of clean water? Are newspapers going to survive? Etc. Etc. Read every day to understand what is going on.

LLa) Don’t go to a lot of parties or “meetups” with other entrepreneurs. Work instead while they are partying.

MM)    But, going along with the above rule, don’t listen to the doom and gloomers that are hogging the TV screen trying to tell you the world is over. They just want you to be scared so they can scoop up all the money.

NN)     You have no more free time. In your free time you are thinking of new ideas for customers, new ideas for services to offer, new products.

OO)     You have no more free time, part 2. In your free time, think of ideas for potential customers. Then send them emails: “I have 10 ideas for you. Would really like to show them to you. I think you will be blown away. Here’s five of them right now.”

OOa) Depressions, recessions, don’t matter. There’s $15 trillion in the economy. You’re allowed a piece of it:

FedEx, Microsoft, HewlettPackard, and many huge companies were started in recessions or depressions. Leave economics to the academics while they leave good business to you.

PP)       Talk. Tell everyone you ever knew  what your company does. Your friends will help you find clients.

QQ)     Always take someone with you to a meeting. You’re bad at following up. Because you have no free time. So, if you have another employee. Let them follow up. Plus, they will like to spend time with the boss. You’re going to be a mentor.

RR)      If you are consumer focused: your advertisers are your customers. But always be thinking of new services for your consumers. Each new service has to make their life better. People’s lives are better if: they become healthier, richer, or have more sex. “Health” can be broadly defined.

SS)       If your customers are advertisers: find sponsorship opportunities for them that drive customers straight into their arms. These are the most lucrative ad deals (see rule above). Ad inventory is a horrible business model. Sponsorships are better. Then you are talking to your customer.

TT)      No friction. The harder it is for a consumer to sign up, the less consumers you will have. No confirmation emails, sign up forms, etc. The easier the better.

TTA) No fiction, part 2. If you are making a website, have as much content as you can on the front page. You don’t want people to have to click to a second or third page if you can avoid it. Stuff that first page with content. You aren’t Google. (And, 10 Unusual Things You Didn’t Know About Google)

UU)     No friction, part 3. Say “yes” to any opportunity that gets you in a room with a big decision maker. Doesn’t matter if it costs you money.

VV)     Sell your company two years before you sell it. Get in the offices of the potential buyers of your company and start updating them on your progress every month.  Ask their advice on a regular basis in the guise of just an “industry catch-up”

WW)    If you sell your company for stock, sell the stock as soon as you can. If you are selling your company for stock it means:

  • a.         The market is such that lots of companies are being sold for stock.
  • b.         AND, companies are using stock to buy other companies because they value their stock less than they value cash.
  • c.         WHICH MEANS, that when everyone’s lockup period ends, EVERYONE will be selling stock across the country. So sell yours first.

XX)     Execution is a dime a dozen. If you have an idea worth pursuing, then just make it. You can build any website for cheap. Hire a programmer and make a demo. Get at least one person to sign up and use your service. If you want to make Facebook pages for plumbers, find one plumber who will give you $10 to make his Facebook page. Just do it.

Fail quickly. Good ideas are HARD. It’s execution that is a dime a dozen.

YY)     Don’t use a PR firm, part II. Set up a blog. Tell your personal stories (see “33 tips to being a better writer” ). Let the customer know you are human, approachable, and have a real vision as to why they need to use you. Become the voice for your industry, the advocate for your products. If you make skin care products, tell your customers every day how they can be even more beautiful than they currently are and have more sex than they are currently getting. Blog your way to PR success. Be honest and bloody.

ZZ)      Don’t save the world. If your product sounds too good to be true, then you are a liar.

ZZa) Your company is always for sale.

AAA)  Frame the first check. I’m staring at mine right now.

BBB)   No free time, part 3. Pick a random customer. Find five ideas for them that have nothing to do with your business. Call them and say, “I’ve been thinking about you. Have you tried this?”

CCC)   No resale deals. Nobody cares about reselling your service. Those are always bad deals.

DDD)   Your lawyer or accountant is not going to introduce you to any of their other clients. Those meetings are always a waste of time.

EEE)    Celebrate every success. Your employees need it. They need a massage also. Get a professional masseuse in every Friday afternoon. Nobody leaves a job where there is a masseuse.

FFF)     Sell your first company. I have to repeat this. Don’t take any chances. You don’t need to be Mark Zuckerberg. Sell your first company as quick as you can. You now have money in the bank and a notch on your belt. Make a billion on your next company.

Note Mark Cuban’s story. Before he started and rode it to a few billion, he sold his first software company for ten million.

GGG)   Pay your employees before you pay yourself.

HHH)   Give equity to get the first customer. If you have no product yet and no money, then give equity to a good partner in exchange for them being a paying customer.  Note: don’t blindly give equity. If you develop a product that someone asked for, don’t give them equity. Sell it to them. But if you want to get a big distribution partner whose funds can keep you going forever, then give equity to nail the deal.

III)       Don’t worry about anyone stealing your ideas. Ideas are worthless anyway. It’s OK to steal something that’s worthless.

IIIA) Follow me on twitter.

Questions from Readers

Question: You say no free time but you also say keep emotionally fit, physically fit, etc. How do I do this if I’m constantly thinking of ideas for old and potential customers?

Answer:  It’s not easy or everyone would be rich.

Question: if I get really stressed about clients paying, how do I get sleep at night?

Answer: medication

Question: how do I cold-call clients?

Answer: email them. Email 40 of them. It’s OK if only 1 answers. Email 40 a day but make sure you have something of value to offer.

Question: how can I find cheap programmers or designers?

Answer: if you don’t know any and you want to be cheap: use,, or craigslist. But don’t hire them if they are from another country. You need to communicate with them even if it costs more money.

Question: should I hire programmers?

Answer: first…freelance. Then hire.

Question: what if I build my product but I’m not getting customers?

Answer: develop a service loosely based on your product and offer that to customers. But I hope you didn’t make a product without talking to customers to begin with?

Question: I have the best idea in the world, but for it to work it requires a lot of people to already be using it. Like Twitter.

Answer: if you’re not baked into the Silicon Valley ecosystem,  then find distribution and offer equity if you have to. Zuckerberg had Harvard. MySpace had the fans of all the local bands they set up with MySpace pages. I (in my own small way) had when I set up I also had 10 paying clients when i did my first successful business fulltime.

Question: I just lost my biggest customer and now I have to fire people. I’ve never done this before. How do I do it?

Answer:  one on meetings. Be Kind. State the facts. Say you have to let people go and that everyone is hurting but you want to keep in touch because they are a great employee. It was an honor to work with them and when business comes back you hope you can convince them come back. Then ask them if they have any questions. Your reputation and the reputation of your company are on the line here. You want to be a good guy. But you want them out of your office within 15 minutes. It’s a termination, not a negotiation. This is one reason why it’s good to start with freelancers.

Question: I have a great idea. How do I attract VCs?

Answer: build the product. Get a customer. Get money from customer. Get more customers. Build more services in the product. Get VC. Chances are by this point, the VCs are calling you.

Question: I want to build a business day trading.

Answer: bad idea

Question: I want to start a business but don’t know what my passion is:

Answer: skip to the post: “How to be the luckiest person alive”. Do the Daily Practice. Within six months your life will be completely different.

Question: I want to leave my job but I’m scared.

Answer: same as above question.  The Daily Practice turns you into a healthy Idea Machine. Plus luck will flow in from every direction.

Final rule: Things change. Every day. The title of this post, for instance, says “100 Rules”. But I gave about 70 rules (including the Q&A). Things change midway through. Be ready for it every day. In fact, every day figure out what you can change just slightly to shake things up and improve your product and company.

Your business is not your life. When you start a business you also get a cognitive bias that makes you think your business is GREAT.

Every day make sure you are not smoking crack. The most important thing is your health so you can be persistent. If you smoke crack you can die.

I hope you succeed. Because I really need that smart toilet that sends my doctors text messages after doing urinalysis on my pee every day.

Good luck.

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  • Gkoff1849

    Great truisms that are all great. Here are three more ideas that are pretty major:

    1. Watch your income and outgo because CASH FLOW is the mother of all mothers!
    2. Protect your major assets
    3. Make sure you have medical insurance for you and your family if you lose it when you quit your job

  • Dia

    * get your clients a girlfriend
    * micro-manage
    * treat your employees like they were your children

    you’ve got a bad case of diahrrhea

    • Dia Rea

      I forgot about the prostitutes.

  • CapCube

    James –

    One should always return Bill Markel’s calls !

  • Todor Iliev

    One of the best lists with advices for entrepreneurship I have ever read. Thanks, James!!!

  • Natalie Sisson

    So glad you alluded to the fact that we are not superhuman and that fitness, sleep and looking after ourselves mentally is super important. In fact short breaks and exercise stops are known to improve productivity and make you more efficient. So is shortening your work day!

  • straykat

    I totally get that part about Don’t kill yourself. I totally felt that last month, looking at the numbers. For about four months, actually, I questioned if it was totally nuts to gamble everything on this idea. No matter how much market research you do, there’s still this nagging voice telling you no customers will come, and you’ve burned your ships. That’ you’re on a financial train heading for a chasm, and you can’t build a cashflow bridge fast enough to meet up with you when you hit it.

    But the business launched last week and the clients started coming! In two weeks I’ll have a full newspaper spread, I had a speaking engagement, the Mayor came, I’m getting happy reviews and word of mouth, and now it’s on to the next tips: Sleep!

    Thanks for mentioning this often stigmatized part of being an entrepreneur. We have to present such a confident front to get investors and clients, it’s easy to make it look easy and hide the hardship.

    • James Altucher

      Can you tell us your business? How are things going?

      • Stray Kat Studio

        My business creates 3D models on Google Earth and does some locality-search consulting.  Most people don’t know what that is, but within a few years, everyone will know 3D models.  Especially since processing power, internet speed and availability, and technology prices are rapidly improving, and the “gaming” generation is fairly entrenched in the workplace, this “virtual world” presence is a great marking tool (The average online gamer is 35 and makes $85K/yr!).  It also might be the only marketing tool out there that requires no further thought, fees, or maintenance on the part of the business owner.  Websites can’t beat that.

        You can read about it in the online article:
        It was picked up by Associated Press and republished across the country.  I’ve been getting lots of emails since then.  Even a congrats from Google!  After two years of struggle, well, now I can finally start struggling.  But justified, this time.
        At the moment Stray Kat Studio is wandering around Arizona.  Next week San Francisco, then Portland, then back to Alaska by July.  The business is an excuse to travel and meet cool business owners.
        My team is pretty amazing.  (Ok, I might be biased.)  I started out doing the technical work, but now I’m more focused on finding modeling jobs for my team of subcontractors (not employees. Never employees).  I’m more of a talent agent and “Geek”-translator now (they say my accent is pretty good).  I’m trying to automate the customer service process a little better so that I can scale up for when/if the popularity surge of demand comes.I’m not making a living yet, but the tide is turning.  It’s a gamble, though.  Ok I’m actually just Hoping that it’s a tide coming.  Not having sales is a problem one day, then having too many sales is a different problem.  Or, like last week, saying no to work from a “difficult” client, even though I wanted the money.  Starting a business is just a series of problems, with a couple of moments of fun.  But as long as I get to make my own schedule, it’s worth it.  Even though, at the moment, I could probably make more money per hour making coffee.  Still, business is more fun than going to college (I dropped out two months ago), and after 4 years, I’ll probably have learned more, whether this succeeds or fails.  And hey, if I’m flat broke in 4 years, that’s still ahead of most college grads.For point C, I first got a customer before I had a product!  I told him that I’d never made a model on Google Earth before, but if he would be my first client, I’d give him a great deal and he wouldn’t have to pay until it was finished.  He said yes; I said “I’ll get back to you in two months”. I learned how to do it, did it, and he liked it so much he paid me extra.  It was a great confidence boost and experience builder.Thanks for sharing the reality of the entrepreneurial experience.  For the first time around especially, the stress and doubt can be a killer.  So here’s a question:  Does it get easier?  And when?  And how?  As much as I love the process, it would be nice to have this brainchild start doing its own dishes and paying rent.  For now it’s leaving the cute new-business stage and is into an awkward adolescent phase of somewhat chaotic functionality, but with lots of “potential”.If anyone wants a part-time barista for the summer, give me a call!  I’m trying to put myself through “the school of H.K.”  (Why aren’t there scholarships for that?)
        Keep up the great blogs!

  • Rodrigo

    You’re right – it’s not fun… but it can be enriching like nothing else….also agree with the comment about keeping away sharp objects and pills in your worst moments…. thanks for this article!

    • Uneva

      Speak for yourself.  I’m writing a unique book, and having the time of my life.  Doing my own publishing.  Have a popular seller…or two…in mind, and a paid-for school to help me with PR.  I’ll be back when it’s off and running.

  • Leonard Sipes

    Thanks, especially the part about a service as a product.

    Best, Len Sipes, MyLifeAudio

  • Monica_417

    @ Kevin…I keep losing time reading his posts…lukily I’m not on the tube or metro, as we would say, but i have been late to a couple of appointments…I’m addicted to these posts after only discovering James a few days ago and I don’t even understand the first thing about finance! sheesh@45438957a04305c8af9dfa487d590274:disqus

  • Matt Munson

    Great insight. Thanks James. I’d add one thing: every morning, I write down the 3 things that must get done today to move the company forward. A startup is an avalanche of to-do lists, but there are likely only 3 really critical things to get done in any given day. Get those things done.

    • jay

      Hmmm, I find this a very good suggestion.

  • Dominic Rivera

    Great points from #1 onwards…

  • James Altucher

    I was eight years old. I thought Jimmy Carter was the tennis player “Jimmy Connors”. I thought girls had cooties. I called my teacher “old”. My dad hit me when he found that fact out. I was obsessed with astronauts because I wanted to be like Major Nelson on “I Dream of Jeannie”. I also wanted to be like Steve Austin on “The Bionic Man” although I didn’t fully grasp then what it would be like to have no legs and one arm and one eye missing. He covered that part up well.

    And thanks, I just re-read this post for the first time in awhile and I have to say i really like it. So thanks again.

  • Anonymous

    This is an awesome post, I’m glad i made sure this tab stayed open so that I could read through every single point. Thanks for being awesome!

  • kjp712

    When starting a Business give it enough time to be successful.Five to seven years is more reasonable.

  • Volnado

    You Rule

  • Mirren Fischer

    James, I completely agree with A, but I also don’t agree at all. Over the past 1.5 years I’ve had to deal with sleepless nights, panic attacks, lack of motivation, loneliness, relationship problems (probably caused by the previous), etc. etc. And yet.. I am definitely having fun. My mind teems with amusing marketing and product ideas; a lot of the time I want this company to float simply because it allows me to do so many interesting things.
    I HAD to start my own business because I’ve come to the conclusion that I have problems with authority: I tend to work really well WITH other people, but I usually don’t respect my bosses. So I came up with something completely different from my background (I’m an architect, but I also was a daytrader right out of college, then worked in investment advising before realising that I couldn’t care less about the markets). According to a few of your – and other entrepreneurs’ advice, I’ve done one thing really wrong, and I’ve known I was doing it and yet couldn’t snap out of it: viz. I didn’t have customers before I made the leap. In fact, it’s taken me a quite a while to get to the point where I have customers because I had to learn a completely new industry, become a manufacturer, and all sorts of excuses, but mainly because I’m a perfectionist and because I was afraid. No beating around the bush. :-)
    Things are starting to roll now, so we’ll see what happens. After Christmas I’m going to take stock of cashflow, sales, projections, you name it, and see whether it’s worth continuing on my own, whether I should try to find a partner or investor, or whether it’s time to throw in the towel. One thing is certain, however: I don’t regret doing this. In fact I have an idea for another little thing that will require only some energy (since my flatmate is a programmer and can do the website in her spare time). Anyway… just wanted to tell you that I enjoyed the post.
    Oh, one more thing – I don’t agree about avoiding entrepreneur meetups. Yes, you need to spend a lot of time working, but having the support of a community of people who understand what you’re going through is priceless.
    Cheers, Mirren

  • Richard

    Will someone buy my Idea and prototype if I’m not a C Corp?

  • Richard

    Will someone buy my Idea and prototype if I’m not a C Corp?

  • Orlando Roebuck

    Great post. Although, I don’t agree with all of your rules, I agree with most of them. Ideas are not worthless, they are now worth $150K: Why? Because people FINALLY realize Execution is Easy. (Profitable) Ideas are hard:,  imho of course.

  • George Velarde

    Love this love your Schtick!  odd sort of inspiration.

  • Laura Hurubaru

    Thank you for sharing this valuable lessons.

  • JohnF

    I agree with A) lol.. it’s what i say:

    “If you have a business and you don’t smoke, you’re doing something wrong”

  • Ree163

    Treat your employees like children? Your joke about hitting them in the face was really off. Do you want people to call you Daddy? That is the weirdest, most off-base and offensive thing I can think of to be patronizing to employees as though they have the minds of children. Totally awful advice.

    • David

      I’m guessing, like many of his comments, this one was largely tongue-in-cheek. You should probably learn to pluck the advice from the humor, then discard the advice you don’t choose to take. In my opinion, he’s just trying to make a dry subject a little more fun.

  • Christina Wong

    YES YES YES. I completely agree with the first one. My family has several small businesses, and it’s not all fun. Now, we have fun and we can make it fun sometimes, but it’s not just sitting at home 

  • Samantha Prinsloo

    This was probaby, no, in fact it WAS the absolute best article I have EVER read! Usually long articles turn me off, but I was hooked! I endeavor to take all of the advice posted here in order to make my business as successful as yours :)

  • TeeK

    I just found your blog through–the article about self-publishing–excellent, by the way.  I intend to try it.

    This list of 100 things is fantastic.  I have a micro-business which developed literally by accidentally getting customers first, and realizing that it was something I could run with.  I have done a lot of things you suggested just from intuition but I’m still on a major learning curve and it’s true: it’s usually not fun but it IS very rewarding in other ways. 

    This is my favorite rule and something I do with every customer:

     KK)     On any demo or delivery, do one extra surprise thing that was not expected. Always add bells and whistles that the customer didn’t pay for.

    Said another way, if a customer believes or has the perception that they are getting great value out of your product or services, they will talk, even if they can’t put a finger on precisely what extra surprise thing you’ve done.  I believe that alone is why I have more business than I can handle, and every bit of it has come from word-of-mouth referrals.  
    I also believe it’s important to adapt to your customers’ needs and desires.  I started in one direction only but have adapted/expanded/changed/gone in different directions because my customers asked for it.  Adaptability has increased my revenue too! :)  If something is simply beyond my capacity, I have a ready list of other competent businesses to whom I refer them.  

  • Rod

    Yeah I thought about the same. I really would like to ask him about this book.

  • Ronlavine

    This is great info – you’ve got me revvved up this morning

  • Manuel Tijerino

    Great advise.

  • Morphine_magic

    To cut costs and be profitable , a model of U.S & India programmers can give you benefit on lower costs , round the clock development. You wont achieve with just U.S Developers, think about it.

  • Rene

    Ok, I know this is an old comment, but I had to ask. Whats the difference here between SPAM and email? One of my sites just got shut down for SPAM, but we do not have a list, we were simply contacting potential clients with relevant opportunities. How do I contact 40 people via email and not get blocked for SPAM?

  • Anon

    Intersting but assumes that you are dealing with reasonably intelligent people (customers and employees)

    unfortunately many of the employee related points aren’t really applicable in the socialist UK – looks alot easier to manage in the states!  I’ve had a much better experience micro managing a remote team than local ‘talent’ but i suppose it depends where ur.

  • Russell Taylor

    What about cashflow business investing and just snowballing into more cashflow business? Why sell if there is profits?

  • Eiji Fuller


    I love your thoughts and advice. I have a business that isnt doing as well as I think it will. I build custom contemporary furniture and Im gifted in that area but not so much on the business side. Im barely making ends meet with nothing left over. I love designing and building furniture and would like to make alot of money doing it. How can I accomplish that goal?

    Eiji Fuller

  • hussein ghouleh

    Man, you’re awesome…

    Not only you input guidelines that helped me a lot, but it far extended that every time I come to your blog, you just keep recharging me to do even better.

    I tip my hat to you my friend…

    Appreciating always,

  • hussein ghouleh

    Man, you’re awesome…

    Not only you input guidelines that helped me a lot, but it far extended that every time I come to your blog, you just keep recharging me to do even better.

    I tip my hat to you my friend…

    Appreciating always,

  • Keyeast5

    Here’s one…Love your customers but “REALLY” Love your vendors.  It is important that you  demonstrate that you can meet your obligations by paying your vendors early.  Once you can accomplish this you will find they will be willing to extend financing for any venture you may consider.  There is nothing more important to an entrepreneur than unsecured financing.

  • Le

    Model and prostitutes, huh.  Good morality.  I feel sorry for your girlfriend.  

  • Anonymous

    If you are going to lead a business, …you should become educated regarding the following topics,…and then learn to apply the theories in your business, social and personal life,….

    – Ego-States,…how to interpret and respond productively to Adult, Child and Parental Ego-Stated situations.

    – Human Motivation,…Safety, Security, Belonging, Prestige & Self-Actualization

    – The Three-Brain Theory

    – Linear & Looping Communications 

    – Creating a self-esteem raising form of performance improvement or improved communications.


    RJ O’Guillory
    Webster Groves-The life of an Insane Family

  • Benjamin Bernank

    too many rules make james a dull boy

  • Charles

    You missed one.   ANSWER THE PHONE   It sound simple, but so many companies just don’t do that simple thing

    • jay

      Maybe they fear telemarketers. :)

  • Jascheng

    Think fast and do not think too much on making decision, instead of think big?

  • Anonymous

    Nice one! Good to see a different perspective….. and yes I’ve just followed you on Twitter.

  • Rob

    ” learn how to be very specific in your product specification so that your programmers can’t say: “well you didn’t say that!””  LMAO.  No one is capable of that…not even programmers.  To this day, I wonder how people can get mad at me when THEY REALLY DIDN’T SAY THAT!!!

    Honestly, give programmers tasks in writing.  Don’t even bother talking to us.  We don’t want to hear you talk anyway.

  • Matthew Engquist

    Heeh, LOL @ “It’s not fun.” But it is true. You should expect more hardships than fun when running a business. The business industry a very competitive field and only the sturdy remain. Making your employees feel that they have a home in your company can encourage them to put in more effort in their work.

  • Ehwl229

    I’m 23 years old and I’m an entrepreneur. I always imagined that life as an entrepreneur would be full of passion and excitement, but it I’m pretty miserable right now..but hey I’m not giving up. Anyway that’s besides the point. John, you write in your other article that execution is a commodity and can outsource to people in India, but you write here to hire locally. What exactly do you recommend??

    • Robert Bynum

      12 year olds mowing neighbors yards are entrepreneurs. We are all entrepreneurs until we take our first salary jobs and become incapable of anything else. Congrats on breaking away.

    • Bohn Studios

      Don’t outsource to India unless they are high qualified people from India. If you are miserable then YOU SHOULD GIVE UP. Life is way too short to spend any of it being miserable. If you are unhappy, then you should do something else. Maybe try a different type of business or re-evaluate your approach to what you are currently doing. Running a business is not for everybody. If you don’t enjoy something then you are probably not going to be good at it…by default. I started my business when I was 18 ( I’m 28 now and I have consulted in just about every type of industry. Point is I know what I’m talking about. From one young business owner to another…

  • Anonymous

    Hi, Altucher! Here is russian translation of your post:

  • Ron Bohn

    Lost my a$$ in my first business from that. Thanks for the reminder Steven. I forget the exact quote from Einstein, but it was along the lines of “insanity is trying the same thing over and over, but expecting different results.” ….LEARN FROM YOUR MISTAKES…(although it can be cheaper to learn from the mistakes of other people)

  • Zeka

    HA! Funny how a lot of people choose to pay attention to the frivolous reference of models and prostitutes rather than learning a thing or two about running a business and becoming a better person along the way; classic! Great blog, James. A lot of hard-earned wisdom that I shall put to good use. 

  • John @ 55

    On point A: It’s not sexy.  It’s often embarrassing; can knock the wind out of you and bloody up your face a bit.  It’s life threatening.  But pulling off a start up (or 5 or 6 of them in your lifetime) is life affirming; sometimes thrilling; creates lifelong bonds with others who can relate to what you do … and in the balance is fun.  Not “trip to Disney” fun … but in a complicated sort of way … fun.

  • Digital Butterfly

    It’s actually illegal to cold-call in email. The person you are emailing needs to have opted-in or requested more information through another medium for a business to target their email address.

    • Anthony

      In the UK you can cold-email any business directly, just not consumers.

    • Daniel Endy

      Get a grip.  Spam is spam.  Sending an email to someone you don’t know is marketing. Sending a template offer letter to 100 people you don’t know is spam.  It’s all in the details.  

      The key is to succinctly and eloquently describe what you have to offer and to find people who need what you are offering.  How you do that is up to you.

    • BusinessSoftwareCentral.Com

      why, CAN-SPAM rules says it is ok if you follow the rules

    • Anonymous

      Most ESPs’ rules are actually stricter than is required to safeguard against abuse and ignorance. CAN-SPAM regulations state that you may send one unsolicited business email. In it, you want to include a strong call-to-action (request) that they use the included link to subscribe/respond if they wish to open a dialogue. If not, they must be moved to your suppression list and may not be emailed again.

    • Capickerel

      Making alcohol was illegal at one point too, but people still made it. Better to ask forgiveness than permission.

  • Uneva

    You sound like me, TG.  Bad grammar, punctuation, etc., are like fingernails on a chalkboard.  It’s such a common practice, though, that the sting (unfortunately) is becoming a bit less painful.  …Can”t afford to be too lenient.  I’m an author.  ;-P

  • Hardik dwivedi

    I dont understand your rule ” Hire local” as I think for a new startups it doesn’t matter from where you are hiring , it only matters how good is the person in doing his job.

    • P Jaunne

      communication in the early startup phase is everything.  hard to communicate well if not local.  back when I was a corporate drone, I flew overseas many times just to meet someone for a short meeting then flew right back.  Very expensive, but the face-to-face communication made it all worth it. Local hire is expensive but the ability to communicate face to face, in most cases, is priceless.

  • Daniel Endy

    Some good points here, some I’m not sure about. And one I object to.

    “Raise a ton of money, and hoard it.”

    I suspect you mean something more nuanced.  In the real world if you raise money you take on interested parties and you have to listen to them (at least a somewhat). If you don’t listen you have created a broken marriage.  That will be an anchor around your neck.  VCs invest to see their money put to use.  They don’t invest to see you put their money into safekeeping.  (Remember the parable of the talents.) VC is for building your company.

    I believe you meant to say, ‘spend it wisely’.  No argument there. 

    Rase a ton of money? I believe you meant to say ‘raise as much as you can’, but even that is not something I would recommend.  Raising money is a game of optimization.  When to do it, and how much to raise depends on the following.

    1 – Raise enough to last you 18 to 24 months – this is a rule of thumb, but it’s a very good one.  Raise less and you will be back raising money again before you have had enough time to put the last raise to use. Raise more and you will be raising too much and it will be harder because smart investors know how much is the right amount. (And trust me, dumb investors are not worth the money.)

    2 – Raise no more than a 20% stake / dilution in each round.  This is my own personal rule.  I’ve not heard anyone else state it, but I’ve seen the number come in around this sweet spot over and over again. I came up with the 20% rule when I was first considering raising money.  I did a spreadsheet to analyze what repeated rounds of dilution would do to my ownership.  The whole point of raising VC is that it’s better to have a smaller piece of a bigger pie (generally speaking).  Do your own spreadsheet.  Given the other factors, raising more than 20% means either you are undervaluing your business, or you are raising more than you probably should.  Rarely, you may get someone who is throwing money at you and for a good valuation.  That’s a tough call.  That’s potentially dumb money.  As I noted above, that woman may look great, but be sure you really want to marry her.  Divorce is no fun, and nobody wins.

    3 – If you can’t find money in the 20% range either you don’t have a business that’s worth investing in (undervalued), or you have a business that’s too attractive and they want to invest more than you need because they want to own your company.  Unless you are ready to get pushed out, don’t do it. They will want more and more influence/control, and you will find it hard to keep them at bay.  

    If you have a business that is so attractive that they want more than 20%, you probably don’t need that money.  Period.  Go make money ‘the old fashioned way’, earn it.  Get out there and keep doing what you are doing, and refining your proces, your product, and your business.  

    4 – Many good businesses are in bootstrap-land. They can grow steadily by good hard work.  They should not raise money from investors.  They should get back to business.  Raising money is tough.  It’s distracting. It requires good sales skills.  It’s fraught with danger.  So is boot-strapping.  But with boot-strapping, you own it.  

    5 – The big exception is if you need a particular feature/function, and the time window is short, and if you don’t add this soon, you will miss the opportunity.  No.  Sorry.  That’s normal.  That’s not an exception.  It’s an entrepreneurial illusion.  Get back to work.  

  • Daniel Endy

    Steven, more generally, do your very best not to let a single customer account for more than 25% of your business.  It’s called over-concentration, and it’s incredibly risky.  I’ve seen it, but thankfully I never had the problem.  It’s very tempting to have a single big client/customer, but they dominate your business, and you can’t count on them being there for you if things change, which they always do.

  • Daniel Endy

    Awesome post!  I just found this.  Obviously, I need to hang out here more often.  This should be called Entrepre-twits.  

    I especially agree with the find your first customer ASAP concept.  It’s so easy to live in ‘theoryland’ and to design the perfect product.  There are no perfect customers, so don’t bother. Find real customers and serve them.  

    I agree that good ideas are a dime a dozen.  Turning them into businesses is hard.  If you value your ideas too highly, you spend too much time protecting them and not enough time implementing them.  If you are better than creating ideas than implementing them, find a way to sell your ideas.  

    Great ideas are less common, but the same rule applies.  It doesn’t matter until somebody builds something.

    I have a couple things to add:

    A – Ownership – Decide on ownership as early as possible.  If you are working with someone else, a co-founder, or call it what you will, and you don’t have a clear agreement, you have a problem and it will only get bigger.  If you don’t have an agreement, you don’t have anything.  Until you have an agreement, you only have a problem.  And never, ever do a 50-50 arrangement.  It’s just not workable.  I could go on, but the point is that someone needs to be the tie-breaker.  It works fine until you have something you can’t agree or compromise on, and then it’s a complete disaster.  You can do 51/49, or even 50.1/49.9, but never 50/50.

    B – You are a Consulting Company – Until you have a decent size, established, repeat customer base, you have a consulting company.  You are solving unique problems and looking for commonality.  You have a service and you are working on prodcutizing or standardizing it into an established paradigm.  Until you get there, stay flexible and be creative.  It’s the only way to handle the inevitable twists and turns.  Do not consider these challenges to be problems.  They are the market guiding you to a real product that the real market needs.

    C – Sales is Primary – Most importantly, focus on sales.  Not sales of smoke and mirrors.  Sales you can deliver on.  It’s ok, if what you sold needs to be built before it can be delivered.  That’s not smoke and mirrors.  You don’t have to have it built before you can sell it!  

    D – Product is Secondary – I learned early on that the best products do not win.  It’s the best sales team that wins.  You can have a mediocre product, and with a good sales team you can be very successful.  You can have the best product in the world, but without a good sales team, you will lose to the competitor who is better at sales.  

    E – You are in Sales – I’ve never seen a company succeed where one of the founders was not a good sales person.  You don’t have to be good at all phases of sales, but you have to be great at some of them.  Whether you are selling your ideas, selling your products, selling your company to investors, or selling working there to potential employees, you are in sales.  Get used to it, and get good at it.

    I have one quibble.

    Sell your first company?  Maybe, but for me my first company was me consulting on nights and weekends.  There was nothing to sell.  My second company was a product I built inside another company, and I had no idea how incredibly great it was, and I had no leverage because they didn’t know it either.  My third company was my first real independent jump off the cliff and hope the parachute works venture.  On that one, I merged with another company which is essentially selling, so maybe you are right.  Get to a safe haven so you can feel successful and continue creating interesting companies.  Oddly, I’ve found the first couple were easier, then it got harder, then it got easier again.  I suppose the first were beginner’s luck, the middle was thinking you knew it all due to the initial dumb luck, and the latter phase was true wisdom.

    Thanks again for a great post!

  • P Jaunne

    A – can’t agree more.  The idea of FUN in entrepreneurship is often paradoxical though it has so many levels and dimensions and can easily be misunderstood.

  • EntrepreneursKorner

    I agree with you hugely on selling your first company as quick as possible, Check Out:
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  • Rohit Arora

    Don’t let the difficulty of task affect your momentum or your willingness to pursue it – 

    Taken from 10 lessons in success from James Bond,

  • David Wood

    I agree completely with the “do not hire employees unless absolutely necessary.”  You don’t need more children then the ones you already have.  Sounds cruel I know but business is business.  However, one thing I would suggest is that if you are in the unfortunate position of having to have employees then for God’s sake use a good PEO (Professional Employer Organization).  These are companies that take the human resource crap out out of your business by using a “co-employment” relationship between you and your employees.  The PEO is the employer of record for taxes and benefits and the client is the “worksite” employer.  The PEO handles all the payroll taxes. work comp, unemployment issues, and even firing employees based on your orders.  HR is a huge government mandated albatross around an entrepreneur’s neck and outsourcing it is the only sane solution this side of moving to China.  And no I don’t sell PEO services or work for one but years ago I did.  And no your accountant can’t replicate the services of a PEO.  What they want are your business and personal tax business which PEO’s don’t touch.  Google it.  A good PEO can save your ass in a bad HR situation and is well worth the surprisingly low fees that they charge.  Check it out.  Good blog otherwise and I will keep reading it and recommend it to my associates.

    David Wood
    davidwood@woodtelco:disqus .com

  • Greg

    Agree on “A”. Reading on.

  • Dennis The Menace

    I would like to comment about the start up of a new business and the high failure rate. I believe that one of the biggest mistakes that individuals starting a business can make is not trying to find ways of saving money. Saving money on rent advertising labor. Thinking up creative ways of conducting your business or promoting it that cost far less than most of the conventional ways of doing business can greatly increase your odds of succeeding. When small business owners inially begin their business adventure running out of captial or money is very often the biggest reason that many of these businesses fail after of course lack of knowledge about the business they are starting. Another thing to consider is starting a business that does not require a large start up cost. If you can find a business that requires little money to start up and if it fails then you will not have lost a very large amount of money’ and remember their are lots of businesses out their that started out with just hundreds of dollars not thousands. If you have employees always look for ways of reducing turnover. High turnover can be very distructive to a business

    • jay

      Very good point there.

  • Thomas Hoi

    Can I test my idea by posting onto my facebook status?

  • Fiona

    Dear James,

    This site has just the right tempo for me. It suits me – Clever with the right amount irreverence.
    I was going to comment yesterday on rule no.1. I was glad I read you thought starting up a business wasn’t fun. I’m hating it. I’m hating myself. But I didn’t bother.
    I’m writing now because I overlooked an email in early January. Not intentionally of course, I too love anyone who writes to me or gives me business. Today I found out I lost a terrific contract because I didn’t check a little used business email address. It feels a bit like the proverbial straw and very surreal…..I have no one to blame. I am a dick!! It is harder to perceviere when the raw material you are dealing with is a dick. So to add another rule to the list….CHECK ALL YOUR EMAIL ADDRESSES EVERY DAY! I feel absolutly nothing….shock I think.

  • Kshitij Mittal

    Hey James, HI!
    In one point up there, you mentioned If I am really stressed, I can call you.
    I think I need to call you.
    Please mail me your number @ kshitij.mittal01@gmail:disqus .com so that I can call you :)(:

    P.S: As I already told you, Smileys are indispensable…

    To be entrepreneur, who’s to be girl friend still hates him :(

  • Penny Stock Blog

    I think 100 rules is just over doing it. Why not just en rules keep it simple 

  • forex broker reviews

    Very interesting article. Thanks for your excellent post.
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  • Rob238

    James, Just found this post, so sorry for late comment.  Your advice is fairly good, but it begs the two most important rules:

    Number 1 — the founder(s) have to be really smart, savvy and dedicated (as in top 1% in all three).  If they aren’t, the business won’t be successful.  There are no accidents and the competition is brutal. 

    Number 2 — If a software/internet/mobile business isn’t based in the Silicon Valley, the founders aren’t savvy.  No, NYC doesn’t work (foursquare is a fluke and not that successful).

    Other important rules:

    -Never hire a CFO.  They’re expensive and don’t add any value.  Hire a part time bookkeeper instead.

    -Yes, you need venture capital to be successful.  Friends and family round can’t get you there.  And yes your lawyer can introduce you to the right VCs if you have the right lawyer.  Your accountant can’t. 

    -You want and need to burn cash to be successful so don’t worry about time to breakeven unless its within 6 months.  Only worry about growing the business.  Nothing else matters.

    • James Altucher

       Well, on my last business which I sold successfully I did not take in VC money, I was not based in silicon valley, and I used minimal cash until we were profitable (which happened almost instantly) so I don’t think I agree, Rob.

      I think what you are saying could make things go faster but even then I’m not so sure. VCs often get in the way of what could be a good exit for a founder (a VC might not let you sell for $10mm even if you were begging on your hands and knees).

      I agree with the never hire a CFO. Unless you plan to go public.

      Again, on the NYC thing, look at all the successful cos here (there are many). I think you might have a misguided view thee.

      • Rob238

        JA, I think the world of your blog and you totally rock…especially on Kudlow.  But here’s the honest truth.  I see a lot of NYC and SV companies.  The contrast in quality is dramatic.  What was the last NYC IT company to go public?  I don’t even remember.  Has there ever been one?  I was at NYC Finovate last September and there were a few good NYC based companies, but overall really disappointing… and if NYC can’t do fintech, what can they do?  Dwolla based in Des Moines Iowa was better than any NYC company.  Seriously.  Shaker, a NYC company, won 2011 techcrunch … really?  Virtual bars on facebook?  Groupon is an amazing company in Chicago, but that’s a fluke and frankly
        they don’t have much IT…it’s really just a proprietary email list …
        a really big one.  Compare that to SV.  The quality of start-ups I’m seeing is just phenomenal.   The place is on fire.  Every week I’m seeing a new company that could change the world.

        As for the $10m liquidity event … that’s good.  But only for the founder, and maybe not if there’s an earnout or 3 year vesting of deal proceeds … pretty common terms in those little sales.  Good companies get a series A pre-money of north of $15m.  Sure the founder is probably down to 50% or so after that, on a fully diluted basis, but that’s $7.5m for the founder and that’s before the company is really getting going.   I’ve got a 1 year old company that just did $1m in revenue last month.  Prior month was $500k.  Month before that was $250k.  That’s cool.  Yes they have venture money, so founders are down to 50%, but that’s 50% of a rapidly growing company that just hit cash flow positive despite the board’s best efforts to the contrary.  Their junior programmers right out of college now have stock options that may be worth $10m when the company gets sold and/or goes public.

        Why do NYC startups suck?  I know that’s too harsh.  But honestly, they should be better.  I think it’s the culture of the city.  Success is being an MD at a big investment bank and getting a big bonus or being a partner in a white-shoe law firm representing banks in project finance deals for 10 years at 100 hours per week.  That’s just death.  Creativity doesn’t play into that.  Office politics and client skills are what’s rewarded. Everyone in the business world in NYC is so afraid of failure.  Risk is there to be hedged.  Who gets the women in NYC? Internet entrepreneur or investment banker?  That’s the ugly reality … NYC culture has a dark side … get the nice haircut and tailored suit.  That’s what the chicks dig.

  • Airsee

    Awesome rules!

  • Customise Wordpress

    Wow, that’s the longest list of pieces of advice I’ve ever see. Add one more…don’t be too verbose.

  • Kapurmarsha

    she gives me motivation to entree

  • Steve Barna

    First off, these are not “Rules”. They are your observations, based off your experiences.  “These are rules. Not theories. I don’t need to prove them.” I beg to differ. If science were based entirely off of one persons subjective experience… life would be much. much different. 

  • Jetlir Izairi

    I don’t understand: 

    “Your lawyer or accountant is not going to introduce you to any of their other clients. Those meetings are always a waste of time.”

    What’s behind that? 
    What if we are talking as lawyer’s and especially accountant’s as marketing client’s? 
    Why shouldn’t they sent you client’s, if you even give them like 20%?

    Personally, I had one lawyer as a client so far, and right away he sent me one of his accountants (from a franchising company) as a referal. 
    kind regards,

  • Andreas Kopp

    I have printed it out. I think I think I want to look at this list every day.

    • jay

      Me too Andreas. I feel like I am attending an entrepreneurial training of some sort around here. Will surely keep on coming back.

  • TradingPub

    Thanks James.  Great post as always!

  • John

    does anyone know if this guy’s even got a successful company. From what I can see he just writes books promoting ideas and blogs on Techchrunch to market his books/blog.

  • Ansia

    wow ! very nice reading..!

  • Taran Rampersad

    I suppose prayer rules out atheist being successful entrepeneurs.

  • Mary McNamara

    Well said. One of the most awful positions an employee can be placed in is being the “only one” who can do something, and getting turned down when they beg for someone to share what they know with, so they won’t be the only one who can get the job done. The smart employee knows better than to allow themselves to remain in a position like that.

  • Dyess

    Read the 10-k of all the heavy hitters in the game, see what its like. 

  • Shawn

    “GGG)   Pay your employees before you pay yourself.”Good Guy Greg indeed.

  • thetecnica

    I would love to meet some who become an entrepreneur with the help of  this article. I don’t think any article can help you, its only you who can do it.

  • Kevin Redick

    I removed all of the sharp objects that were close.

  • Mike

    I’m working with Sri Lankans, they are awesome and cheap!

  • jasontoheal

    there’s a lot here. I think i’ll need to revisit the post to be able to digest it in bite size chunks, but thanks for posting it. I like that you called it “starting a business” and not just the catchy “startup” term that everyone seems to think is somehow different to starting a business.

  • Tim Goetz

    Agreed! Its not fun. Its actually the opposite… Its painful.. I call it ‘the addiction’. Someone should start a support group.

  • criagdickens

    Great List!!!! I love your style…Funny I recently posted “101 Ways to Grow Your Business” as a bonus to “ways to grow…Now! Hope you find some additional practical and common sense realities in it as well.

    Keep doing what you do!

  • gene beckwith

    Can you explain “sponsorship opportunities “?

    • Kevin Redick

      Sponsorship can be for special events in fundraising as underwriting. Hope this helps. Kevin J. Redick
      (805 896-3107

      The information contained in this email message is legally privileged and confidential intended only for the use of the individual or entity named above. If you are not the intended recipient, you are hereby notified that any dissemination, distribution or copy of this message is strictly prohibited. If you have received this message in error, please notify us by return email and delete the contents. This correspondence is covered by the Electronic Communications Privacy Act of 1986, Codified at 18 U.S.C 1367,2510-2521, 2701-2710,3121-3126. Gramm-Leach-Bliley Act 15 USC, Subchapter1, Sec. 6801-6809.

  • Nate Ginsburg

    Hey James, this post gets better and better every time I read it. As a young entrepreneur who has experienced a bit of success and some failure and some success again this post is really helpful. Thank you!

  • Junky Jay

    Man, honestly you’re the best. Thank you for everything!

  • Richard


    It’s a $15T economy. But averaged over 310M people, that’s $48,387.10 each. That’s close to the median income. Even if you trim it to wage earners, it’s not an order of magnitude more.

    There has to be a better way.

  • Luke

    Too many rules. I follow the golden rule with clients. Do unto others as you would have them do unto you or as my Dad said “Do the right thing with customers and you’ll reap the dividends”. By following these rules, you meet my main rule that “Long-term clients are must better than short-term clients”. Common sense should direct you from these principles.

    • James Altucher

      Common sense goes out the window in the middle of the shit storm.

  • Jay Oza

    I like this blog since success requires one to do double digits of things you have to do. When someone ever gives advice it is always single digit and it is a good read but does not help.

  • Galaxier

    This is the book of entrepreneurship

    • James Altucher

      Galaxier, funny. I am definitely planning on expanding each of these points so, overall, it will be a book. I will do it after my next book, “Choose Yourself!” coming out in a fe months.

  • jay

    I read this word for word and the comments as well. That was a nice one Steven. I learned this lesson with a very expensive price.

  • jay

    Oh gosh! I am learning a lot from you guys. Thank you Bigtime.

  • jay

    That’s a very hypnotic title post. Will look into this. Now I am in a trance.

  • jay

    Yeah! I have learned this lesson the hard way. If I only knew better.

  • jay

    Does the rule also applies to Bangladesh and the Philippines too? OR this is exclusive to India only. (NO racism, sarcasm intended).

  • jay

    WE are doing an outsourcing job here in the Phlippines. And James has a point about pricing getting dear. But you can always negotiate. As the rule says, look for a win-win deal.

  • jay

    I concur on this Mich, I have experienced the same thing as well. I thought I was doing my business a great favor my working a lot and sacrificing sleep and social life but I only became disoriented and groggy. In the end, it was not a very wise decision. Keeping the balance is the key.

  • jay

    I’d like to contribute one. I think a lot knew about this already but still many start-up business owners forget or fail to follow. The rule is, don’t spend company funds on personal leisure (that even if you are the sole proprietor of the business).

  • Bondi Buddha

    Good post! I love the point about throwing a party and inviting off duty prostitutes and strippers LOL! It’s about time someone got real : )

  • TJ Hale

    BB – Fire employees immediately. We don’t wait around to see if cancer will cure itself. had to learn this one the hard way…now I don’t hesitate. Excellent List James

  • Alan Warms

    James, Really great. I especially like a) don’t hire PR agency (that’s you) b) micromanage developers c) no friction d) don’t spend time hobknobbing w fellow entrepreneurs

  • Mike Krass

    Have gone months without pay while continuing to honor my employees contracts and pay them. You know what? It was worth it, because without those guys & gals our product would be a worthless ‘idea’ as James astutely pointed out in the post above :-)

  • Jacob Aaron

    Hey James, isn’t TT) sort of broken while signing up for your insider’s list?

  • @2BallsOfBrass

    I believe you left off one that you do have in your book “Choose Yourself” And that is – have a good bowel movement. Few things in life are as satisfying as a good bowel movement.

  • Lauren Gilbert

    You are so right about selling your first business and – if taking stock for part of the sale, try to sell it right away (of course, there may be restrictive holding periods- be sure to have a good broker/lawyer). Love your book “Choose Yourself.” Hope you don’t mind, I am going to plug it this weekend @ a conference! Loren

  • GPA

    Oh yes, disease….a big costly flaw of mine. Still not good at the firing thing.

  • Rodney T

    Great post James. I would add the following:

    – people always underestimate the importance of skills they don’t have. Know what you are weak at, and when you find great people skills that complement yours, grab them. But don’t use your weaknesses as an excuse for not getting better at things you find hard.

    – the mountain is clearer from the plain. In the end you’ll have to make the decisions and live with them, but listen to people you respect and whose opinions you value. Sleep, exercise, or a change of scene will influence your own perspective on decisions as well.

    – Don’t loose your mojo: nurture your creativity and it will richly reward you. Taking time out especially at the weekends is essential. You don’t need to take 2 weeks holiday for this, a night out at the theatre or doing something you’ve never tried will do the trick. This also applies to your team – pile into a van and head off for a day skiing. The conversation as you drive there and back will be more valuable than a week in the office.

    – Don’t become a micro manager, you’ll suck all the joy out process, sooner or later you are going to have to learn to trust your team. Although I started out as a developer, for our product I made a decision to not commit a line of code to the repository and focus 100% on customer-facing and product owner roles. In the Mythical Man Month (the famous treatise on project management) there is a rule I always keep in mind, that you can tell someone what to do, or how to do it, but never do both.

    – Following on from last, if you find yourself writing emails to someone on your team at the weekend (or when they are on leave), save them in your outbox and send on Monday/when they get back. Also ANY email you are about to send but not 100% sure about, save it, and have another look in the morning.

    – on cashflow, one way to optimise cash is to change your terms of trade, offer a discount on a multi-year license, on projects always bill a significant component up front. This is cash that never has to be paid back, there’s no strings, no interest.

    – the strength and depth of your customer relationships will have a profound effect on your business. When were developing our new product our key customers were prepared to pay double their annual license fees a year in advance on the strength of their trust in us, their desire to see us go ahead, and how we engaged with them (through design, functional prototypes, discussions) in defining the product.

    – a recessions is a terrible thing to waste. You can take more time to get things right, it may be easier to find and retain great staff/contractors.

    – Question every dollar you are spending.

    – design and research can pay huge dividends. Our product has a strong interaction and educational design focus, and a high degree of technical innovation in terms of technology.

    – Access the resources of your local university. We’ve employed computer scientists, business and design students through our local University, several interns later becoming employees.

    – Joel Spolsky (Joel on software) talks about the value of the Duct Tape Programmer – like the guy in the formula one pit who will slam some tape on the car and get it back out on the track if that’s what it takes: in a startup you need developers who can balance the long terms aims with the shorter/immediate term requirement to deliver to a deadline. If you have a customer (you have one, right?) who you’ve made promises to, you need to meet them. Developers want to build something numinous, but often a primitive but highly functional first pass will be sufficient, may be all that was ever needed. Suitability for purpose at each stage of your development process is the key here.

    – access Government and other support/investment programmes

    Rodney Tamblyn /

  • John Smith

    101. if doing lists of 100 things, use numbers not letter

  • Gregory VandenBosch

    Right on James…really good stuff.

  • Saya

    Great post per usual James!


    I disagree with three of your rules —

    ‘It’s not fun’
    Maybe I’m doing it wrong, but being an entrepreneur in my life is nothing but FUN! These have been the most fun-filled nine years of my life. Being an entrepreneur brought me a husband, press in the NYT/Forbes/Crains/Huffington, opportunity to speak at TEDx, travel to Rwanda/Portland/NYC, the chance to help countless people inject more FUN into their lives, and on and on.

    ‘Always take someone to a meeting’
    I say NEVER take someone to a meeting. Or any other type of event. While it’s scary and nerve-wracking and you feel like you’re back in middle-school trying to figure out where to sit in the cafeteria, it’s sooooo much easier to meet people when you’re solo. I haven’t spent any money on marketing/advertising in my nine years and attribute much of that to the fact that I go to parties, networking events, etc. solo and force myself to sparkle with strangers.

    ‘Don’t go to a lot of parties or “meetups” with other entrepreneurs. Work instead while they are partying.’
    I agree with the idea of not going to parties or meetups with people in the same field as you. But I say go to tons of parties and meetups in general. That is ‘work.’ Or at least how I work. Especially if you’ve mastered the skill of talking about yourself/your business in a way that’s engaging, productive, and steered by the person you’re talking to – I find myself talking about what I do for 45 mins at a party because others keep asking me question after question.

    Rules I’d add:
    Not every client should be a client. Money isn’t worth having to work with people who drive you nuts.

    Sometimes saying yes means saying no.

  • ivanob

    Writing two more articles like this wouldn’t be a enough, because a lot of things can be crucial for running a business. Be a lucky or smart for choosing a right startup idea is just a start. There is need for a lot of other things to be set so it can be successful business.

  • Sabby

    what sort of businesses are we talking about here? business where a product is at the centre of it? also, if you have an idea for an app/program, but absolutely no programming experience, what do you do?

  • Aurangzeb Agha

    The “No jerks” rule: Don’t work with assholes. It doesn’t matter what (or how much) they bring to the table, refuse to work with jerks.

  • Umar Saeed

    Thanks for sharing such comprehensive information about entrepreneurship. It will really help in establishing my online business and market search platform. Now I have got much guidance from this article. Thanks

  • atomic living design

    #A) YES. i wish someone would have told me this earlier. (also “Here’s the real rules” doesn’t sound right. Shouldn’t that be “Here are the real rules”? but i still get the point)

  • Chris

    This article is featured in our new eBook at as well as – you guessed it – 49 other business articles. With chapters including Minimize Risk, Legal and Money.

  • Tessa Olson

    I haven’t made it past A yet, but I wanted to stop and note that it’s 100% true. I had a particularly un-fun moment today (re: logo design, DIY edition), and I’ve only been at this entrepreneur thing for a couple months. Also just listened to your interview on Rich Roll’s podcast today–really inspired by such a fresh perspective. And looking forward to reading the rest of this post.

  • Business Plan Mentor

    C. Get a customer before you start your business.

    This rule validates whether or not your business idea is viable before you shell out any cash. I just wrote a post that advises this rule and gives an example of how to start a small business on the side and grow it to your dream business:

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  • Harsh Chheda

    Thanks for this great article. One doubt – in point XX you have
    mentioned “Good ideas are HARD. It’s execution that is a dime a dozen.”
    and in point III you have mentioned ” Ideas are worthless anyway.” Could
    you please throw light on your interpretation of these points. Thanks
    for your time and consideration.

  • Gem

    Question: You say no free time but you also say keep emotionally fit, physically fit, etc. How do I do this if I’m constantly thinking of ideas for old and potential customers?

    — you can always think while keeping physically fit! like while walking, exercising, your brain is running.

  • Nick Cicerchi

    Hey James – when you talk about the definition of entrepreneur, I think you pretty much summed it up by the saying “Choose Yourself!”

  • Nick Cicerchi

    I’ve boiled it down to 5 daily practices for me. Can’t remember who said it on James’s podcast… you can’t control your outcomes, but you can have a daily themes, structures, or practices as I call them. Here are mine: 1. Read (something inspirational 2. Write 3. Exercise 4. Meditate (or whatever you want to call your quiet time) 5. Work on your current goals.

  • Deborah Tutnauer

    You asked for a comment on number one.
    Yes. It is hard.
    And Yes. Hard is OK. One can live with hard as long as they believe in what they are doing. That kind of hard is much different than “working on the chain gang” kind of hard.

    As for change…it is in fact the only thing we can count on.


  • Krishna Mohan

    Currently I am an employee in a company with a part time job and doing B.Tech with computer science. But now i want to start my own company of same production as that company in which i am employee.
    It is legal or not ?
    Can that company complained on me and my company ?
    Please help me .

  • Esther

    Damn, I know what you are talking about.

  • Esther

    Great Great advice, should of heard this a long time ago…Will put into practise..

  • Casbah

    4 years late to the party. However I’m about to leave the party because of rule EE. I will take with me some valuable advice but I know my own mind and where happiness dwells and it’s not in a world where you use women as objects for a business party, you are just wrong on that point, I don’t give a fuck who you think does it or if the ‘whole of business does it’. For all your wisdom you are a fool. I had just read your ‘was Buddha a bad father’ and your concluding statement ‘I hope I’m a better father than Buddha’ Holding these views on women you are a bad example of parenting. Have a read of something you posted in that Buddha post and re-read EE, B) For every physical, verbal, emotional, and mental action you take, FOCUS before, during, and after to make sure nobody is getting hurt. If you have the delusion nobody is getting hurt in prostitution then you need to seek a couch. Not offended by your thoughts just disagree. Peace to you though fella, wish you free from difficulty and wish you progress.