Chapter 6: “Building the Company”
Chapter 6 feels like the point where Reiss stops talking theory and starts dealing with the messy reality of actually running a business. The shift from “getting started” to “building the company” is significant – it’s the difference between having an idea and managing the chaos that comes with making it work.
The planning framework he outlines makes sense on paper, but I can already see how easy it would be to get bogged down in the details. His four key factors – goals, strategy and tactics, timing, and risk – sound straightforward until you realize how interconnected they are. Change your timing and your strategy shifts. Adjust your risk tolerance and suddenly your goals look different. It’s not as linear as the chapter structure suggests.
What amazes me about the people management section is how Reiss acknowledges something most business books gloss over: founding entrepreneurs often struggle with letting go of control. His advice about embracing other people’s ideas rather than forcing your own vision sounds logical, but I imagine it’s incredibly difficult in practice. When you’ve been the sole decision-maker, sharing that authority must feel uncomfortable, even when you know it’s necessary for growth.
The money management advice is sobering. His point about needing more capital than you initially calculate rings true – every entrepreneur I’ve heard from mentions being surprised by unexpected costs. The idea of staying ahead of the cash curve rather than scrambling to catch up makes sense, but it requires a level of financial discipline that probably doesn’t come naturally when you’re focused on a hundred other priorities.
The culture section caught my attention because of how practical the wallet card example is. Most companies talk about culture in vague terms, but AMB Property’s approach of literally putting their values in employees’ wallets shows they’re serious about making it concrete. The I.C.R.E.A.T.E. acronym might seem cheesy, but at least everyone knows exactly what the company stands for.
Reiss’s supplier management philosophy surprised me. Treating suppliers as partners rather than vendors makes business sense, but it also requires a mindset shift. Most people think about minimizing costs, but his approach focuses on maximizing value through relationships. The payment advice – paying bills on time, providing adequate lead times, sharing information – sounds basic, but I suspect many small businesses fail at these fundamentals when cash gets tight.
The section on managing professionals (lawyers, accountants, bankers) feels like hard-won wisdom. His point about separating advice from business decisions is crucial. Too many entrepreneurs either ignore professional advice or follow it blindly. Learning to extract what you need while maintaining control of your business seems like a skill that takes time to develop.
The credibility-building strategies reveal something interesting about business psychology. People want to buy from established, trustworthy companies, but every company starts somewhere. The publicity, endorsement, and licensing approaches he describes are essentially ways to borrow credibility until you can build your own. It’s smart, but it also highlights how much of business success depends on perception as much as reality.
The licensing section opened my eyes to possibilities I hadn’t considered. The idea that you can build a business around someone else’s intellectual property, or use your own IP to generate revenue without manufacturing, changes how I think about business models. The Mickey Mouse watch example shows how licensing can work for the biggest brands, but I’m curious about how accessible this strategy is for smaller companies.
What’s missing from this chapter is the emotional toll of building a company. Reiss touches on the practical challenges but doesn’t address the psychological pressure of managing people, dealing with cash flow problems, or maintaining relationships with suppliers when things get tough. The advice is sound, but it assumes a level of emotional resilience that might not be realistic for everyone.
The chapter ends by acknowledging that there are big topics left uncovered – getting customers, conserving money, planning for the long term. That makes sense given how comprehensive each topic could be, but it also highlights how complex building a company really is. Each area Reiss discusses connects to several others, creating a web of interdependent challenges that have to be managed simultaneously.
Reading this chapter makes me appreciate why so many businesses fail in their early years. It’s not just about having a good idea or even adequate funding. Success requires managing multiple complex systems while making countless decisions with incomplete information. The low-risk, high-reward approach Reiss advocates throughout the book becomes even more important when you see how many things can go wrong during the building phase.
The practical tone of this chapter is both encouraging and daunting. Encouraging because it proves these challenges can be managed with the right approach. Daunting because it shows just how much there is to learn and manage. The transition from entrepreneur to business builder clearly requires a completely different skill set.
Works Cited
Reiss, Bob, and Jeffrey L. Cruikshank. Low Risk, High Reward: Practical Prescriptions for Starting and Growing Your Business. R&R, 2000.