Question: What’s the biggest mistake I made while starting/running my business?

I had lunch with our new employees recently and we were all telling our stories. I talked about starting a business in college and ultimately selling it to Engauge in 2008. One of them asked the question, “What’s the biggest mistake you made while running your company?” What a great question. Unfortunately, I hadn’t considered that question before. Oh, I’ve made mistakes. Plenty of them. In fact, I wrote a post a few months ago entitled, 10 Mistakes I’ve Made So You Won’t Have To.

But the biggest mistake, that’s a tough one.

I thought I’d ask two of my original partners this question and see what they thought our biggest mistake was.

One said:

Our biggest recurring mistake was bad hiring – we whiffed on a lot of people we hired – especially mid to high level people we brought on, a lot of turnover as well across low/mid/high level people, we hired only a very few number of difference makers over the years.

Maybe another is not being very aggressive about expansion – the market for web work has been incredible (unprecedented in the history of the world’s economy) over the past 15 years – and will never grow at that rate ever again – I guess if we did it all over again we would have just attacked and attacked and grown and grown and iterated on stuff to try to make the most of that wonderful time from the late 90’s through 2008. 

Another said:

So, I have a hard time remembering one or two specific big mistakes, but off the top of my head there were a few traps we seemed to routinely fall into as we grew, that I try my hardest to avoid this time around:

1) Waiting too long to part ways with team members that don’t fit or aren’t performing.  You get this feeling that it will be more painful to replace them than to limp along with them.  Or you get a feeling that a great producer isn’t replaceable.  Both are myths.
2) Hiring people into management positions that end up doing more damage than good.  
3) Taking on bad clients that wind up costing more money than they make.  
4) Create too many middle managers, not flat enough management scheme.

I’d have to agree with all of their points. Along the way, hiring the right people (for the right job at the right time) is one of the most critical aspects of growing a business. You can really be set back a ways if you hire the wrong people, particularly if you put them in leadership positions.

Almost all the other mistakes I mentioned when I was having lunch with the staff were things that ultimately made us better. Signing a terrible contract made us better at writing contracts in the future. Things like that. But hiring is something that is always a challenge.


  1. On admitting mistakes on September 11, 2012 at 5:35 am

    […] about admitting my mistakes than some are comfortable with. As an example, I blogged in June about the biggest mistakes I’ve made while starting/running my own business, sharing the experiences of my co-founders as we tried to build our business. I’ve also […]

  2. Old School on October 17, 2012 at 12:40 am

    It’s a shame that too many companies these days seem to forget that there is a good alternative to churning and burning through people in the hopes of hiring a few who might luckily come with their talents “pre-aligned”. I remember when more companies used to invest in developing the “difference makers” they need – getting loyalty and a strong work culture in return. An over eagerness to ‘dispose and replace’ seems to be a fairly expensive method of lazy trial and error.

  3. The Flaws of the Hero Hiring Strategy on September 4, 2013 at 7:40 am

    […] who weren’t a good fit for my company or for the role we gave them at the time. In fact, my partners and I all agree that hiring the wrong people was the biggest mistake we made over the […]

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