“I’m convinced that about half of what separates successful entrepreneurs from the non-successful ones is pure perseverance.” Steve Jobs
As a successful entrepreneur and investor, I’m often asked how easy it is to start and manage one’s own business.
The life of an entrepreneur isn’t for everyone. It takes persistence and patience. As I’ve discussed before, whatever business or service you are considering will take more work, time, effort, and money than you think.
Every entrepreneur’s journey is different, but entrepreneurs are driven by the same thing: to create a profitable, successful business.
Here are my top tips for anyone considering embarking on an entrepreneurial journey.
- Make Time for Family. No business is worth spending all of your time at work at your family’s expense. In my 30 years as an entrepreneur, I have always made it home for special occasions, kids’ sports events, recitals, etc. With careful planning, you can do this too. It’s very important to balance work and family. Some of the best entrepreneurs I know have great family lives as well as a thriving business. I firmly believe the two go hand in hand.
- Realize That It Won’t Be Easy. Let’s face it: If owning and running a business were easy, everyone would do it. Being an entrepreneur is hard work. Think of long hours and pitching your wits against the odds. In the early days of your business, don’t even think about long vacations, but you will need some down time. Short breaks are essential.
- Only Start or Acquire a Business That You Understand. Don’t confuse what you like with what you know. A few years ago, I invested in an Internet company (which I like) that was highly technical (which I don’t know). I thought I understood the business, but it became clear very quickly that I did not. It was a painful experience. Stick to what you understand. You can hire specialists and experts to support you, but you should be fully conversant with the type of business you intend to start.
- Research, Research, Research. Market research is the process of discovering what your customers want, who your competition is, and what current and future trends can affect your business. Research needs to be done before you start your business because you need to know if your business idea is viable. Research also helps you become an expert in your business, including your products and services, competitors, and target market demographic, as well as the market conditions that will affect your business. The more research you do to find the answers you need, the better you can plan for success.
- When Hiring People, Listen to Your Gut. Hiring the right people is essential. Creating a strong team will help you move the business forward and get projects completed on time. If, in the interviewing process, that little voice inside your head raises doubts in your mind, do not hire! Keep looking. Like most early stage businesses, you’ll likely be trying to conserve as much cash as you can. If you can’t afford to pay the going rate for the position, offer a bonus or stock options only when success is achieved. Always remember that you need to record everything in writing you’ve promised the employee, and have your attorney create an employment letter or employment contract. Read my blog post about hiring consultants.
- Make Sure You Have Enough Money. Yes, I’ve written about this before and it sounds axiomatic. How do you know how much money you need? The first thing to do is to build a business plan. A business plan is an essential road map for business success. This living document generally projects 3-5 years ahead and outlines the route a company intends to take to generate and grow revenues. You’ll need this if you intend to apply for any type of Government Loan Program such as those offered by the Small Business Administration (SBA). Investors will likely want to see this too. (Check out my blog post about finding investors.)
- Find a Mentor. If you don’t have someone in mind, the best place to find a mentor is the Service Corps of Retired Executives (SCORE). SCORE offers the nation’s largest network of free, expert business mentors. If you’re just starting a business, SCORE mentors can provide the practical action plan, education, and tools you need to open your doors and establish a customer base.
- Keep the Expenses Down. You don’t need a fancy office or premises. Buy second hand office furniture (it usually sells for peanuts). When traveling, use frequent flyer miles, research airfares using multiple sites (it takes time, but you’d be surprised how much money you can save), and consider different travel dates to find cheaper fare. Print documents on both sides of the paper (better yet, cut down on printing all together). Use a credit union instead of a bank. Credit unions are not-for-profit organizations that exist to serve their members. Like banks, credit unions accept deposits, make loans, and provide a wide array of other financial services. As member-owned and cooperative institutions, credit unions provide a safe place to save and borrow at rates generally less than the big banks. Entrepreneur Magazine has a number of other business expense saving tips.
- Nothing Happens Until You Sell Something. You might have the best idea in the world, but until you sell it (and get paid), it doesn’t mean much. My advice? Get to that all-important first sale as quickly as you can. You will be amazed at how excited you feel when you actually sell something from a business you own!
- Perseverance is Key. You must overcome the temptation to give up. There will be plenty of challenges, most of which you never even considered while in the planning stages. That’s OK. Starting and managing a business is a learning process. Recognize that you will likely have to battle the challenges of staying focused and managing those nightmare unexpected expenses. Watch out for and deal firmly with flaky consultants or clients. Call on friends, business advisors, and professionals like lawyers and accountants for help. Remember that a problem shared is a problem halved. It’s easy to reach a point where you don’t think you can or should continue with your business. Stick with it; it’s a numbers game. If your sales are off for one or two months, work harder to find new customers by making more sales calls than usual. Offer discounts to bring customers in the door.
Over the years, I’ve proved that you can succeed with a little luck, hard work, dedication, and focus. But the best, most important lesson I learned early in my entrepreneurial career was: Never, ever, give up.