Working the 5-rule success strategy

Dovetail’s Ash Fogelberg and Nick Frandsen are a couple of schoolmates who dropped out of Uni to embark on a spectacular start-up journey. Ash shares their five rules for succeeding in business.

After first meeting as 16 year olds at Wanaka’s Mount Aspiring College, Ash Fogelberg and Nick Frandsen went on to become best mates and, in their early 20s, business partners with their ticketing and payments company 1-Night.

Entrepreneurship comes naturally to these two. After dropping out of university to start 1-Night they quickly built the company up, always with a view to a managed exit and acknowledging the fact that it would be a learning experience.

‘High growth, high potential’’ soon became Ash and Nick’s mantra for business success, but as Ash points out, the key was to ensure that any business venture they got involved in was stable over the long-term.

That’s precisely the road they’ve gone down with their latest venture Dovetail – a self-financed tech agency and services business which they’re growing to be one of the most premium tech companies in Australasia.

Dovetail builds end-to-end digital products for clients – designed, developed and structured for hosting. “We get involved in a lot of awesome projects for big companies, but we also get to build up a team and capability for industries that we have knowledge in – as well as build longevity into Dovetail.

“The parent company also has the opportunity to get involved, or invest, in other start-ups,” explains Ash, speaking from Dovetail’s Sydney office. “So we have our stable business core, funded by agency work, which allows us to get involved in other start-ups in different ways. Often that involvement is during the very early stage of building products and helping find investors, and carries the business through to the next stage.”

Right now they have three start-ups in their portfolio. 

While many business founders may only go through the loop of starting a company once or twice in their lives, Ash and Nick have been, and continue to be, involved across a number of tech ventures. Along the way they’ve compiled the following five rules to help pave the way to success:

Rule 1: The younger you start, the better

“Warren Buffett notes the only thing that correlates with success is age,” says Ash. “So basically if you start young in business then you have a higher probability of being successful in an entrepreneurial pursuit. And this is backed by data; success has nothing to do with your economic background – it simply correlates to how soon you get started. 

“Start early and you have a longer time to learn and to make those inevitable mistakes,” he adds.

“You also have a higher tolerance for risk when you’re young, as well as less responsibility around family or mortgages. And if you do fail, your ability to recover is so much stronger – as is your ability to apply lessons to your next venture.”

Of course, that’s not to say you can’t succeed in business when you’re older – there are many examples of this out there too, Ash points out.

Rule 2: Go into business with a learning mindset

“Optimise yourself for learning, rather than outcomes,” explains Ash. “If you consistently get better at assessing and approaching situations, and making decisions, then better outcomes will become inevitable.” He refers to it as ‘compound learning’, and it pretty much mirrors how compound interest works over time in the financial world. The more you learn, the better your problem-solving skills will become. This is where a mentor or advisor makes a difference too.

Rule 3: Take a long-term perspective

“There are only a small number of companies that are very successful within a short time-frame,” says Ash. “The large majority of companies take five or ten-plus years to establish and demonstrate good success. So ensure that your decisions are optimised not just for the immediate future, but also for the long term.”

Long term thinking also helps keep you sane through all the ups and downs, he points out. “The downs will feel less significant; you just see them in the context of the longer journey.”

Rule 4: Control your risk

“If you’re young, you can afford the risk of having all your eggs in one basket. If you lose the basket you can just start again. The older you get, the more diversification and safeguards you need,” explains Ash.

Rule 5: Read plenty of books

An add-in to Rule 2, this rule provides a shortcut to knowledge and personal experience, and helps optimise for the long term. Life is a journey of continuous improvement and problem-solving, Ash says. “You can learn from your own experience and from the experience of others, and it’s much faster and cheaper to learn from others,” he says. “[Printed] books are absolutely the best way to ‘download’ other people’s knowledge.”

Continuous improvement

Rules 1 to 4 are contextual, explains Ash. “It’s hard to make rules hard and fast for everyone. Depending on where someone is at in terms of age, background, business stage and other responsibilities, some advice can be really useful and helpful; other advice can be not so helpful.”

The key, he believes, is to focus on continuous improvement and learning, and on internal metrics rather than metrics outside your business. 

Having a business partner with whom you can share the ups and downs will make the journey a lot easier, as will engaging with an advisor or mentor for support. “Someone who can put a mirror up against you. That’s something you can never outgrow.”

Ash is grateful for Nick’s input as well. It’s a relationship that works so well because of the deep level of trust they’ve built up over ten years. 

“I have absolutely no qualms leaving the business in Nick’s hands when I go away, and vice versa. We have a lot of confidence in how each other thinks about problems and makes decisions.”

Successful partnerships also result from good communication and expectation management, he says. “Having a shared understanding of what you’ve set out to do.

“You need to have those difficult conversations around commitment, and how ownership would be handled if one partner was no longer around.

“You need to talk through all those hypothetical situations up front.

“But the most critical requirement is values,” says Ash. “If your values are misaligned then it’s only a matter of time before the partnership dissolves.”