I want to dispel a widely held myth: cash alone does not guarantee a successful business. As well as financial capital, business owners need two other vital types of capital to succeed: intellectual capital and social capital. Social capital refers to your networks and relationships, and intellectual capital to your knowledge and education. Together with finance, these are a business owner’s Holy Trinity of capital.
Money matters, but knowledge, networks and mentorship are just as important.
Unless you’re a polymath with unlimited time, you won’t have all of the skills you need to make your business flourish. A formidable strategist or programmer needs support from marketing and PR, and vice versa. Trying to do it all yourself is counterproductive.
Get more intellectual capital by investing in your team. Of course, hire smart and experienced people, but keep investing in them. Train them and listen to them. Encourage and support them to study for new qualifications. Make sure you’re constantly learning, too – read articles, go to meetups and listen to talks.
Furthermore, get yourself a good mentor with experience in your area of business. If there’s someone you admire, shoot them a message on LinkedIn, outline what you love about their work and invite them for a coffee – you’ll be surprised how open people are to being a mentor.
Social capital manifests in interesting conversations, empathy and ‘I’ll put you in touch over email’. It’s the soft capital that links you to fellow business owners, industry people and potential team members. To raise more of it get out of the office and go to networking events and conferences. If you’re a smaller business, consider joining a coworking space.
Business is not a rigid science, and rejecting the myth that finance is the only important source of capital is a good start to looking at the issue more holistically. Business owners need skills, networks, relationships and mentorship just as much as they need cash.