Dan Novaes warns that entrepreneurs often chase too many ideas, which fragments focus and wastes effort. He recommends acquiring already-operating, cash-flowing businesses that fit with your company as a way to scratch the itch for new projects while preserving momentum and generating value.
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I think entrepreneurs tend to focus on too many different things. It's the blessing and the curse. The blessing is you always have ideas, you're always able to pivot, you're always innovative. The downside is that not all ideas are good, but you are going down so many different paths and you're unable to focus. If those things don't stack, you ultimately will just be doing a bunch of things that don't add value to one another and you'll spin your wheels. I did that for many years and also went through a lot of different iterations of my business that were like short term gains, short term wins that didn't hit long term. If you're going to do that, focus on something that can stack in your business. For me personally, like where I found a good opportunity to be able to scratch that itch while still seeing good value, is finding other businesses that we could buy that fit within our company that are good cash flowing assets. Because it kind of has that same type of feeling of like, oh, like here's this new thing, like what ideas do I have to kind of make it better? But the business is already working, it's cash flowing, it's a good valuation. And sure, like we had to get to a point to be able to fund those businesses and buy those businesses. But that's the same type of feeling I got when I'm trying to do a zero to one idea. But a zero to one idea, you have no idea if it's going to work because it's zero and oftentimes it doesn't work. And so I have just spun and spent a lot of time on things that I thought were going to be great and many of them weren't. If you want to get more of this, follow us and get all of our hacks for free.
