I read a ton of business books for entrepreneurs. I just did a quick tally off the top of my head and came up with 20 books I’ve read this year, which is one every few weeks. I suspect I’ll slow down once the baby comes in February.
So everyone’s read The Lean Startup. I love it and it changed my business life—but it’s not what I tell people to read first. Or second.
Let me save you a ton of time and get right to the point. The two books you should read when you’re starting a business are:
Here are the two books you should read when you’re starting a business.
- “Running Lean: Iterate from Plan A to a Plan That Works” by Ash Maurya
- “Slicing Pie: Funding Your Company Without Funds” by Mike Moyer
Running Lean introduces the Lean Canvas (grab my Lean Canvas Template here). It also tells you how to start a business without building anything: Maurya explains how he signed his first 100 customers before developing his minimum viable product.
The secret? Go talk to your potential customers first. Get inside their heads. Make sure you understand how they think. Figure what they’re doing today to solve the problem you’ve identified and how much they’re paying (and watch out if they don’t see it as a big enough problem to do something about).
Then create a mock-up and a pricing model. Do a second round of conversations with potential customers where you walk them through the mock-up and watch their reaction. Get even more inside their heads. And validate your pricing model by getting them to commit to buy from you.
Now you’re ready to start building your MVP and measuring retention—which is the key to evaluating product / market fit.
Go talk to your potential customers first. Get inside their heads. Make sure you understand how they think.
The first problem is that some people end up contributing more than others. Putting someone on a vesting schedule gives you a blunt instrument to cut off their equity, but it doesn’t give you an elegant way to fine-tune their ownership based on their actual contribution.
The second problem is that people sometimes try to change the deal once the money starts coming in (yes I’ve had this happen), and Slicing Pie gives you a plan that you all agree to up front.
And since you asked, here’s a quick rundown of the other best books for entrepreneurs I’ve liked this year:
Since you asked, here’s a quick rundown of other best books for entrepreneurs I’ve liked this year
Books About Strategy
3. “Little Bets: How Breakthrough Ideas Emerge from Small Discoveries” by Peter Sims — Makes the point that successful entrepreneurs actually minimize risk by taking a series of small chances and building on what works, rather than betting the farm and going bust on a bad guess. Also explains that the main job of the entrepreneur is to constantly acquire more resources. Thank you to Vijay Harrell at TradeLanes.co for turning me onto this one.
4. “The Hard Thing About Hard Things: Building a Business When There Are No Easy Answers” by Ben Horowitz — Ben Horowitz of A16Z makes the case that whatever you’re creating needs to be 10x better than current options in order for enough people to be willing to go through the pain of change. He also offers a ton of other crucial insights while telling some terrific war stories. Thanks to Jared Dillian of the Daily Dirtnap for letting me steal his copy before he had a chance to read it.
5. “Scaling Lean: Mastering the Key Metrics for Startup Growth” by Ash Maurya — Ash Maurya’s follow-up to Running Lean, this book talks about how growth happens exponentially instead of linearly. Meaning it’s slow at first and then ramps up 10x at a time. There’s a ton of other great stuff in here including which key metrics to track (retention), how to optimize your funnel (fix the weak link first), the engines of user growth (paid, viral, and sticky), and how to properly run a marketing experiment (measure and time box).
I have extra copies of Scaling Lean, so hit me up if you want a free copy.
And since 10x has come up in two books in a row…
6. “The 10x Rule: The Only Difference Between Success and Failure” by Grant Cardone — This would probably have been better as a blog post than a full book, but the idea is that setting 10x goals leads to greater growth than setting incremental ones. Thinking 10x forces you to re-evaluate all your assumptions and re-imagine your business from the ground up. Even if you don’t succeed you’ll probably come a lot farther than you would if you just set a 12% growth goal.
7. “The $100 Startup: Reinvent the Way You Make a Living, Do What You Love, and Create a New Future” by Chris Guillebeau — Distills the tactics of hundreds of entrepreneurs into key takeaways for your own startup. My favorite businesses are the ones that make money (don’t laugh) and this is all about people who figured out how to generate meaningful revenue on a tiny investment.
8. “Successful Acquisitions: A Proven Plan for Strategic Growth” by David Braun—Explains that acquiring companies is a good habit to get into. It lays out the process for identifying and opening negotiations with the most desirable companies: the ones that aren’t for sale. It’s great to understand the perspective of the prospective buyer so that we can all build our companies to be attractive targets. Thanks to Brian Bernstein for recommending this one.
Books About Developing Your Product or Service
9. “Sprint: How to Solve Big Problems and Test New Ideas in Just Five Days” by Jake Knapp, John Zeratsky, and Braden Kowitz—Analytics tell you what, but they don’t tell you why. In order to understand your customers, you have to sit down and watch them try to use your product or service. The genius of this book is that it lays out a 5-day plan to schedule interviews, brainstorm features, build a mock-up, and decide which questions to ask. Short, sweet, and effective!
10. “The Inmates Are Running the Asylum: Why High Tech Products Drive Us Crazy and How to Restore the Sanity” by Alan Cooper— This book is an oldie but a goodie from back in the days when Visual Basic first launched. The point is that software developers end up controlling business decisions by virtue of what they’re willing to work on, and how this is actually bad for the business.
Analytics tell you what, but they don’t tell you why. In order to understand your customers, you have to sit down and watch them try to use your product or service.
The author instead lays out a customer-centric approach that de-politicizes the development process by creating user personas. Which led me to the book on buyer personas below.
11. “The Secrets of Consulting: A Guide to Giving and Getting Advice Successfully” by Gerald Weinberg — Weinberg is the Will Rogers of consulting. I love this book and consider it a must-read for any service-based business. It’s chock-full of wisdom like, “Clients always know how to solve their problems and always tell the solution in the first five minutes,” “Whatever the client is doing, advise something else,” “If something’s faked, it must need fixing,” “You’ll never accomplish anything if you care who gets the credit,” and “Make sure they pay you enough that they’ll do what you say.”
12. “The Four Steps to the Epiphany” by Steve Blank — I started this book years ago and never finished it. This year I finally did. Blank is famous for telling entrepreneurs to “Get out of the building” and go meet their customers in person. He also points out that companies that win are the ones who make decisions the most quickly. This book laid the groundwork for The Lean Startup, which in turn led to Running Lean (which is the one I recommend).
Books About Sales and Marketing
Your job as a marketer is to figure out how to be there waving your arms at the exact moment your potential customers decide they need to make a change.
13. “Buyer Personas: How to Gain Insight into your Customer’s Expectations, Align your Marketing Strategies, and Win More Business” by Adele Revella — Points out that the most crucial moment in marketing is the moment your potential customers decide they need to make a change. But you’re not there when this happens! By the time they get to you, they’ve already made the decision to change, done the research, and compared you against the alternatives.
Your job as a marketer is to figure out how to be there waving your arms at the exact moment they decide to make a change.
14. “The Challenger Sale: Taking Control of the Customer Conversation” by Matthew Dixon and Brent Adamson— Teaching works better than sales, especially when you can inject fear about a changing landscape combined with a compelling path forward. Thanks to Mark Crofton of SAP — the largest implementation of The Challenger Sale — for turning me on to this one.
15. “Ask: The Counterintuitive Online Formula to Discover Exactly What Your Customers Want to Buy…Create a Mass of Raving Fans…and Take Any Business to the Next Level” by Ryan Levesque— Lays out a strategy for segmenting and selling to your prospective customers using website and email automation. I find this stuff super interesting, and relevant to my own business. Also check out Launch by Jeff Walker. Thanks to my dad for suggesting this one. I’m about to start doing this on my own website so stay tuned.
Teaching works better than sales, especially when you can inject fear about a changing landscape combined with a compelling path forward.
16. “Traction: How Any Startup Can Achieve Explosive Customer Growth” by Gabriel Weinberg and Justin Mares— Makes the case that startups should spend as much time finding sales and marketing channels as they do building out their products. The basic plan is to test a few likely channels and go all-in on the one that works…until it doesn’t anymore. Then move onto the next one. And be prepared for channels that look great at first but don’t work at scale.
17. “Trust Me, I’m Lying: Confessions of a Media Manipulator” by Ryan Holiday —This book lays out a bunch of hacks to grow your public relations rapidly, including how to get major media outlets to cover you using only a few blog posts.
Plus a Book About Psychology
18. “The Power Of Habit: Why We Do What We Do in Life and Business” by Charles Duhigg — Shows how both people and organizations run on habits. Success comes from setting up the right habits, so meaningful change requires re-programming ourselves and our systems.
Thinking 10x forces you to re-evaluate all your assumptions and re-imagine your business from the ground up. Even if you don’t succeed you’ll probably come a lot farther than you would if you just set a 12% growth goal.
Did I miss any other best books for entrepreneurs? Let me know what I should read next!