December 15, 2020
In the last decade, entrepreneurship and the idea of escaping the infamous "9 to 5" has become increasingly popular. Deciding your own hours, not having a boss to report to and living life to your own beat has emerged as most people's "ideal job", even if they don't directly consider themselves an entrepreneur. It's easy to fall in love with the glamour and ideology of entrepreneurship because it favours what humans typically value most, time and control. For those looking to escape their day job and are looking to entrepreneurship as a way out, it's important to consider the caveats as well.
The problem with the modern, social media representation of entrepreneurship is that it strips away the very realistic obstacles, stresses and struggles that new startups and business owners face every day. Most of which can be heavily detrimental to young entrepreneurs that have made significant investment, both time and money-wise into their companies. Startups in this day and age start and stop within a year's time, often because of ambitious entrepreneurs that consider the upside, without taking the time to understand the commitment and fatigue that's required.
If you're looking to venture into owning your own business with little capital, you need to understand that your newly founded company must be your top priority in order to get it off the ground successfully and set the stage for growth. The tough reality with starting from scratch is that anything that takes a significant amount of your time or money during this time will slow down the development process and can ultimately fold your business before it starts. Stay away from financial or time constraining commitments as much as possible. This includes financing vehicles, mortgages, expensive vacations, etc. Your biggest tools when starting out are time and money. Avoid tying those two assets up in other areas of your life.
Our biggest success when starting out was also what hurt us later on. Our company primarily designed websites for customers when we first began. We spent a great deal of time focused on immediate sales before we fine tuned our product and business operations. This meant that we were flush for cash in the first few months, which is typically a good thing, but because we didn't spend as much time as we should doing things like: creating a recurring pricing plan for our products, expediting the time it took us to develop our sites, or understanding the ins and outs of business operations including managing finances and allocating revenue throughout our business – we ended up taking way more time than we needed building the sites and spent money in the wrong areas. As mentioned in Tip #1, time and money are the assets, and we mismanaged both. Make sure that your startup is making decisions now, that benefit you long term.
The mainstream view of owning a business focuses on the celebrity-style life of successful business tycoons with money, sports cars and suits. In reality, startup owners often represent the opposite. Broke, sh*tty cars and sweatpants. Imagine living like a student, but also depending on your "school" to pay your bills. In order to make things happen for yourself, you need to not only understand the reality, but be comfortable living it too.
I don't see this tip shared very often but it's an important one. When a new business decides it's ready to start making sales, they quickly turn to all of their warmest, most easily approachable clientele. This is often their parents, siblings, cousins, friends of the family, etc. Typically those who are easiest to convert into a sale without facing the harsh nuances of selling to strangers. This isn't necessarily a bad thing, but it shouldn't be relied on solely when you're starting out. A forward thinking business should use their first batch of clients to analyze their process both externally with how the customers are buying and behaving, and internally on the costs, ROI, development time and efficiency of their business. In addition, it's important to learn how to sell to strangers early on because once those warm leads dry up, you'll be forced to learn without practice. To summarize, use your warm sales as indicators early on, make adjustments to capitalize and sell better each time, and space out your warm leads to preserve steady income longer.
Arguably the most critical of these 5 tips. My team and I have seen this happen many times to new businesses, and are certainly guilty of this ourselves at times. Entrepreneurs that haven't made a sale tend to spend a great deal of time on "business development". And though I promote being patient and understanding your business, it's extremely common that companies will extend their building stage far longer than what's necessary. This always seems to stem from the same reasoning. Fear of failure. The common misconception is that as long as you're building, you haven't failed yet. "If you haven't botched a sale, you haven't lost a sale". So instead, businesses tend to linger in development to avoid failing publicly. One very key principal is missed here. Once businesses finally do launch their product, business or social media, they end up inevitably finding out that the market decides whats right and wrong with their business, not them. If you or your team spends 100+ hours making their product "perfect", but buying customers say it should be different, you'll end up having to make those changes anyway. "Perfect" is objective to the buyer, not you. Obviously you can't make every adjustment every customer asks for, but spending way too much time "tinkering" before launch will never teach you or your business what your clients are actually willing to pay for.
To sum up, entrepreneurship really can be glamorous in it's own way. Deciding and executing the life you want to live is possible but like all things that sound amazing, they usually take a lot of effort, patience and compromise to achieve.