Sharpen Your Axe

Sharpen Your Axe

“If you gave me 5 minutes to chop down a tree, I would spend 3 minutes sharpening my axe”
— Probably not Abe Lincoln

Most often attributed to Lincoln the quote has existed in several forms. Most of which probably came from some wise old lumberjack who sleeps all night and works all day. The general idea here is to spend time preparing before you just start. Major projects, new business ventures, expanding an existing business. These are all tasks that require some level of planning. Now I know what you’re saying….”But if we spend hours planning those are hours we could have been hustling to actually get results” and I would say you’re right reader and you’re echoing my exact thoughts most of the time. However, with time, and failure, it becomes painfully obvious that spending a few hours mapping out a process or exploring all the “what ifs” in a scenario, will save you time down the road.

A real life example. or How to not be like me.

I love starting businesses. So if you ever open my Google Drive, right near the top of the list there’s a folder chocked full of business ideas. Some great, some terrible and others that are bordering on delusional. All of them are ideas we explore. Some we let go, others turn into businesses we’re actively devoting time on launching. What does this have to do with preparing? If we didn’t plan, if we didn’t spend 3 minutes discussing and detailing out our ideas, we wouldn’t have realized the ideas were terrible until it was too late. We don’t want to put ourselves in a position where we are out several thousand dollars and dozens of man hours simply because we didn’t want to spend 5 minutes questioning and defending an idea. Now the real life example. Several years ago a group of friends and myself wanted to start a business.

Specifically we wanted to own a dirt racetrack. Complete with grandstands, pit area, concession, the whole package. Total estimated cost at time of the dream: $500,000 (remember this number it’s important). This isn’t an overly large sum of money to get a business started. Our projection for income was closing on $50,000 a year after all of our expenses, $500,000 is reasonable(ish). Most banks loan this amount on the property value alone (estimated $500,000 at purchase time, $1million after improvements were made). But they didn’t. We had a plan, sort of. The plan was to get the money, then start figuring out what we needed to get done.

Surprising to noone but myself, banks don’t loan out large sums of money to people with poorly planned business ideas.

But we were having trouble getting financing (most banks don’t loan large sums of money to someone with, what I now realize, what was a sad excuse for a business plan (really it was just a spreadsheet with made up numbers and profit projections). So we started digging on our own to get a solid ‘plan’ we can present to the bank about our endeavor. As we began the journey of discovering. We started to inadvertently sharpen our axe. Planning and determining best actions to get things moving. During the process, we successfully determine what capital we would need, how we would operate the business, and most importantly, how we take a racetrack that has sat idle for several years and get it into race ready condition. The last part is the part that saved us.

Had a bank been dumb enough to give us the capital we thought we needed ($500,000) to get this behemoth moving forward. This move is one that could easily screw us. After what was, even in hindsight, a hopeless optimistic projection of expenses, we would have needed closer to $1,000,000 to even begin to have a chance to make this dream a reality. The more we searched, the more expenses we found. The more expenses we found the sharper our axe became. Until we simply walked away from the tree.

It’s ok if you hate details. But, they’re still important

I absolutely hate having to work on the details. However, I would rather spend a few minutes or hours or days doing something I loathe, then get a million dollars into debt only to realize that I might have misjudged a few small, seemingly insignificant details. I want to just launch then figure out the details as we go. Luckily people in my life will hold me accountable for my mostly idiotic mental gymnastics I try to pull. That doesn’t mean the mindset is wrong, generating ideas is half the battle. But if you don’t plan, then you’re still failing at the other half of the battle, and you will lose. Hopefully it is not a catastrophic failure like my racetrack would have been. Lack of planning will, however, cost you time and resources.

So don’t be like me when I’m by myself. Hold yourself, or finding somebody to hold you accountable to plan. Then take a few minutes, sharpen your axe, and when it’s time to chop the tree down, you’ll know it.