Mark Cuban: This Unpopular Advice Will Make You Richer in the Long Run
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Gabrielle Olya
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Molly Sullivan
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Mark Cuban has always had an entrepreneurial spirit, from selling stamps as a kid to cofounding Broadcast.com, which Yahoo bought for $5.7 billion. Along the way, he’s learned what really builds wealth — and one piece of advice he swears by goes against today’s startup norms.
Here’s the unpopular advice he believes more entrepreneurs should follow to be wealthier in the long run.
Why Mark Cuban Said Bootstrapping Beats Fundraising
Many entrepreneurs are focused on finding investors to fund their businesses, but Cuban believes this should not be a priority when you are starting out.
“So many people get caught up in raising money, but you need customers,” he said during the Clover x Shark Tank Summit. “If you get customers, you can grow your business and own your business. We focus too much on the Silicon Valley ethos, and people think they need to raise money first.”
Instead, Cuban advised bootstrapping as much as possible.
“The longer you work to build your business, the further you get before raising money, if at all, the richer you are going to be,” he said. “That is a big part of the game.
“You want that dream to come true, and the longer you can hold out before raising money, the richer you will be,” Cuban continued. “If you find yourself in a position where you don’t have to raise money at all, you can send me a check.”
Talk To Your Customers — Even If It’s Uncomfortable
In addition to advocating for bootstrapping, Cuban emphasized the importance of entrepreneurs really knowing their customer bases.
“You need to talk with your customers more,” he said. “You need to learn what their experiences are. It’s hard to communicate a lot of times with your customers because we’re all afraid of getting a ‘no.’ You have to talk to them and be brutally honest.”
In the current economy, many people are struggling and resources are tight. That’s why it’s so vital to know what customers are willing to spend money on when they may be actively cutting back.
“It’s harder to know now who’s struggling, and that makes it more important than ever that as a founder you communicate more,” Cuban said. “It can be email, it can be in-person, but you have to communicate. If you don’t know what’s in the heart, mind, soul, budget and bank account of your customers, how will you know how to price your goods and services? That’s the challenge.”
If You Can’t Sell Your Product, You’re in the Wrong Business
Another key to success as an entrepreneur is to be willing to sell what you offer.
“If you are a founder of a company and you don’t absolutely love to sell your product or service, you’re in the wrong business,” Cuban said. “If you don’t think you’re doing your neighbors, customers and prospects a favor by telling them about your product or service, you’re in the wrong business.”
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