Barbara Corcoran is best known as the founder of Manhattan-based real estate empire The Corcoran Group and the only female judge and investor on ABC’s Shark Tank. This month, she shared her eight lessons for business success with a captive audience of female entrepreneurs at the Inc. Women’s Summit in New York City.
Corcoran, who grew up with nine brothers and sisters in a two-bedroom house in New Jersey, built her company in the 1970s with a $1,000 initial investment, given to her by her then-boyfriend and eventual business partner. After their subsequent separation, Corcoran launched The Corcoran Group, which sold to real estate giant NRT Incorporated in 2001 for $66 million. Since selling the business, Corcoran has become an author and TV fixture, speaking and writing on business, investing, and entrepreneurship.
Not all of her strategies are conventional, but they definitely worked for her—and they’re relevant for the rest of us, too. Here are Corcoran’s lessons, plus the takeaways for entrepreneurs today.
1. Perception Creates Reality
Her Story: At the Summit, Corcoran shared how she created the “Corcoran Report” early in her company's history, which declared official median home prices in Manhattan. The report was really based on a small sample size of 15 deals she had done, but Corcoran sent the “official” publication to major press outlets and, within a week, even The New York Times had cited the report. This coverage gave legitimacy to her new company—and brought in a whole lot of new business. “In New York City, the meek don’t inherit the earth,” she said. “The big mouth does.”
The Takeaway: Create your own reality by selling yourself. If you’re presenting metrics for your business to investors or customers, put your best foot forward by highlighting the ones that create a perception of growth and celebrity first. For example, if you need to display your revenues, but cash flow isn’t as high as competitors’ metrics quite yet, find another way to convey financials that plays to your strengths—consider customer growth, profits, or order volume.
2. Everybody Wants What Everybody Wants
Her Story: When certain real estate properties in Manhattan were difficult to sell, Corcoran took it on herself to create urgency for the properties. One tactic: rather than show available properties to one family at a time (the industry norm), Corcoran would invite dozens of families to showings at once. The competition among visitors to put in an application meant that the homes would sell faster. “In business, you’re the Chief Salesman,” she said. “Create a sense of demand, rather than waiting to have demand.”
The Takeaway: To get buzz around your product, you often need to create it yourself. For tech entrepreneurs, a great way to do this is to throw up a splash page using LaunchRock, which can help get your product out there and capture demand even before you’re ready to officially debut.
3. Expand Before You’re Ready
Her Story: The troughs of the real estate market proved to be the best times for Corcoran to grow her business. Why? While larger companies were sulking about the lack of opportunities out there, her small company wasn’t afraid to seek out whatever opportunities it could find. And in the process, she was able to leapfrog over her competitors.
The Takeaway: As Corcoran said, “the best time to expand is when people are asleep at the wheel.” If you’re generating an idea for a start-up, look at opportunity-rich spaces where big businesses are afraid to invest because of the down economy—you may just be on to the next big thing.
4. Shoot the Dogs Early
Her Story: Corcoran has no problem with what most people consider difficult conversations. “I fire the bottom 25% every six months,” she told us. With her consistent policy on getting rid of the weakest links, no one at her firm was ever dead weight for long, and the excess cash that came from having a leaner organization could be used to reward top performers.
The Takeaway: While you don’t have to go to Corcoran’s extreme, you should be thoughtful and proactive about shaping your company. Founders who allow negativity or shoddy work to persist don’t build great organizations. Corcoran also urges founders to pursue positive people—and that’s especially true when you’re in the “trenches” of ramen-diet start-up life. “A complainer is like a Death Eater because there’s a suction of negative energy,” she says. But on the flip side, “you can catch a great attitude from great people.”
5. There Are Two Kinds of People: Expanders & Containers
Her Story: When hiring, Corcoran would quickly assess whether the prospective employee was an “expander,” a more sales-oriented extrovert, or a “container,” a fastidious organizer. Both were critical to her organization—but she saw that employees typically fit one or the other role, not both. And being able to characterize them quickly helped her put the right people in the right positions.
The Takeaway: Learn how to read people efficiently. In a new venture, there’s simply too much work to be done to be re-assigning people. When you’re hiring, try to assess accurately and speedily where a person can fit into your company. And if she doesn’t? Simply say so and move on—it’s better for both of you in the long run.
6. Recognition Motivates Better Than Money
Her Story: At one point, Corcoran needed more premium listings for her company, but couldn’t give a cash prize as a reward. So instead, she gave a gold bow to the agent who could bring in any listing worth $1 million or more. The bow glowing over the desk of a rookie employee—plus the fact that Corcoran eventually moved the employee to a better, bigger desk in the office—was all the motivation the other salespeople needed to drive results.
The Takeaway: Remember that’s it’s not always about money—recognition of achievement can be a huge motivator, too. So get creative in the recognitions you give. If deserved, sometimes a genuine compliment or better title can make up for the money you can’t give.
7. Fun is Good for Business
Her Story: The Corcoran Group became famous for its themed parties (cross-dressing one year, Roman-themed the next) that would get people out of their comfort zone. Corcoran expected her employees to work hard, but she made sure fun excursions and experiences were a part of her company's culture, too.
The Takeaway: People spend much of their lives at the office, so don't let them be miserable there! Corcoran advises managers to “make sure everyone loves each other.” Employees who like their colleagues and feel that their workplace is fun will be more productive (and more likely to work longer hours!).
8. Remember, You Deserve It
Her Story: Corcoran recounted her story of meeting fellow real estate mogul Donald Trump for the first time at his offices. As she rode the elevators with “knees shaking,” she realized that she had no reason to be nervous—after all, she had earned, through her accomplishments, the acquaintance of a fellow successful businessperson.
The Takeaway: Don’t shy away from a networking event because you’re intimidated about being the only woman there, and don’t question whether you can ask for a business card just because you’re young. Wherever you are, “you have a right to be there,” Corcoran says. Don’t be afraid to go to meetings and to meet new people—and to ask for what you need to move your business forward.