Eric Siu shares scaling advice for young entrepreneurs making serious money. He emphasizes building cash reserves for downturns, changing your team as the company grows, and avoiding staying the smartest person in the room. Focus on one business with 30-year thinking instead of side projects.
I just had lunch with a 26-year-old entrepreneur who's making $1 million a month in revenue, and he asked me my biggest lessons on scaling. Here's what I told him. First, trust but verify. You can't just hire someone and walk away. You have to stay involved and inspect what you expect. If you don't, don't be shocked when things fall apart. Second, the team that got you here won't necessarily get you to the next level, and that's okay. But you have to make changes fast. Keeping someone in a role that's outgrown them hurts them and it hurts the company. Third, if you're the smartest person in your group, it's time for a new group. You need to be in rooms where people are a few steps ahead of you. That's how you learn and get pulled up to the next level. Fourth, you want to lock in on one business. Don't start a fund. Don't chase side projects. Just focus. Every distraction kills your momentum. You should think 30 years out and not 3. And finally, you want to build strong cash reserves, especially in a cyclical business. Having cash means you never have to worry about going illiquid and you can weather any storm. If you want to learn the lessons it takes to scale, just make sure you follow.
