Whether you’re weighing up the pros and cons of investing in a new retail development or driving sales at a small business, it’s worth learning from the best.
Many agencies are looking at ways to grow their property businesses, while developers are assessing potential retail, commercial or residential projects. These are essentially investment decisions and must be examined in terms of risks against possible returns. Successfully gauging these odds is the mark of a good investor. This advice from some of the world’s best investors is as relevant to the property industry as it is anywhere else.
“Never invest in a business you can’t understand.”
By following what was ultimately a simple investment philosophy, Warren Buffett became the richest man in the world. He never chased the next big thing, but turned the odds in his favour by making one solid investment after another in businesses within what he calls his “circle of competence”. It is a crucial business lesson because it is easy to be seduced by the idea of turning a fast profit and rushing a decision without properly exploring the risks and opportunities. Every investment, whether it is buying a business or developing a property, should be thoroughly scrutinised and evaluated. If you have to make a decision in a hurry, the best decision will almost always be to walk away.
“Deciding what not to do is as important as deciding what to do.”
Cofounder of multinational technology company Apple, Steve Jobs was one of the world’s greatest “ideas” men. But he also knew that when you truly understand your market and your product, you also know your limitations. It is better to do a few things really well than to do many things poorly. This is as true with property as it is with anything else. One agent can’t sell every house and one developer can’t handle every project, so find your area of expertise and specialise in it. Offer excellence no one else can match.
“Success is a lousy teacher. It seduces smart people into thinking they can’t lose.”
Bill Gates has enjoyed more success than any other entrepreneur of the 20th century, but Microsoft is the company it is because it has learnt from its mistakes. A big part of that is making sure you have a contingency plan. Inevitably things will go wrong, but are you prepared for them? Do you have the necessary level of professional liability insurance? Will your balance sheet withstand a hit to your cash flow if payments are delayed?
“Complexity is your enemy. Any fool can make something complicated. It’s hard to keep things simple.”
The Virgin Group empire built by Richard Branson is characterised by a spirit of fun, but also by accessibility. A great enterprise cuts out as much clutter as possible to focus on the few things that are really important. The less effort required from a customer, the more likely they are to buy the property. Offering a full-service package that needs minimal input will be recognised and rewarded.
“A big part of willpower is having something to aspire to, something to live for.”
Mark Shuttleworth has achieved big things because he could imagine new possibilities. Not everyone can think on that scale, but we all have something we wish to achieve. Wanting to reach it is what drives us, and the more important it is to us, the harder we’ll work to get there. Every business needs a vision. The more clearly it is communicated, the more everyone within the organisation will relate to it and want to attain it. Don’t expect your enterprise to flourish if it has wishy-washy ideals.
“Starting and growing a business is as much about the innovation, drive and determination of its people as it is about the product they sell.”
The innovations of Elon Musk in the arenas of electric vehicles, rockets and renewable energy are changing the world. But behind those products are inspired and committed people, and the exuberance of Musk himself. Products don’t build businesses, people do. This is particularly true in a people-centred industry, such as property, where it is the interactions with clients that determine success or failure. Those who put in the most time and effort to serve their clients’ needs will always earn the biggest rewards.