Starting your own business is a huge undertaking. It requires dedication and true commitment to start something special that will last.
Too often I see people think starting a business is a simple undertaking. Sometimes they succeed and more so than not they do not.
One evening I was having dinner with a group of friends and we got talking about university. One of my friends had to enrol in some business classes as prerequisites for his degree that semester.
As my friend took a big bite of his burger he exclaimed how easy it would be to run a business.
My thoughts left the conversation and drifted to thinking how wrong and naive he was. He had only attended a couple of business classes in the past and thought it was easy to start and grow a successful business.
I thought back to my days at uni when I was studying for a bachelor in computer design. Like any notable entrepreneurial story, mine involves dropping out to co-found my first company.
I remember in the very first year of my entrepreneurial journey I was working 12-18 hour days every single day. Trying to make it work. Much to the displeasure of my girlfriend (now wife), I hardly spent time with her let alone had any free weekends.
Once the first year was said and done, the business I had founded had earned a total of $51,000 in its first year.
Fortunately with a lot of hard work and persistence and about a decade later a LOT has grown and changed. Thank goodness!
Though looking back at those years were some of the best. They taught so many important lessons in business and life. Some of the top lessons I learnt are:
- Building strong business foundations with good systems and processes is key to sustained growth. Not only will it help save your time, energy and money but it will help prevent burnout too.
- Surround yourself and trust in good people. You cant do everything yourself. Be good to your people and they will be good back.
- It is extremely difficult to live off ⅓ of a minimum wage. You sure as hell better have a good plan to get past that start-up stage as fast as you can.
In those early years, the majority of the money earned was reinvested back into the business to help make the business grow.
It is my belief that you need to be a certain type of person to endure such an undertaking. I do not believe everyone has the mental capability of starting their own business.
There is a lot more to starting a business than just working for yourself. You need to have the necessary management skills, industry experience, technical skills, finance knowledge and of course a long-term vision to grow and succeed.
To gain a good understanding of whether you are capable of starting your own business you should analyse yourself before you invest your time, energy and money.
Are you ready to venture into business?
Just like my naive friend, it is important to consider whether you actually understand all that is involved. Some people are better suited to being employed whilst others are suited to business or self employment.
All four quadrants can make money. Its important to remember which quadrant you are in and how you make your money. There is no wrong or write quadrant to be in. If you are starting a business, do not fall into the trap, like so many do, of actually being self-employed.
Before you go out and start your business, ask yourself the following questions:
- Why are you starting a business? Everyone has a reason for going into business. Why you want to go into business will answer a number of questions such as your time commitments, how your business will be structured, whether you will operate as a company or be self employed. etc.
- What are your business and personal goals? Your goals may be very similar to why you are wanting to start a business in the first place. You must consider what your personal goals are as well as your new businesses goals. Will they align together? Both your personal and business goals must not contradict each other otherwise it will be hard to achieve both in unison.
For example if your personal goals are to be working 4 hours a week sitting on the beach sipping cocktails and your business goals are anything but that then they do not align and it will be hard to achieve one or the other at the same time.
- What are your skills? When you just start your business, you may have grand plans of having hundreds of employees or you may only want it to be you. Either way, skills are required to get stuff done. Do you have all the necessary skills for your business to operate or will you need to hire for certain skills. For example if you struggle with numbers then it is important that you have someone involved that can give you the right numbers for your business so you can make the right decisions. You could find a bookkeeper or accountant or you could hire a financial officer. It is important to know what you can do and what you cant do so you have the necessary skills for your business.
- What income do you need to generate? Having a good financial plan will help you not only set goals but give you a good idea on what you need to do to be financially viable in your business. Perhaps your personal goals actually are to be sitting on a beach sipping cocktails. How much money would need to be earned to achieve this?
- What are the advantages and disadvantages of starting your own business? Sometimes it makes more sense to not start a business. Everyone is different and there is no definitive yes or no answer as to whether you should start a business. To help self assess whether you should or not, write a pros and cons or advantages and disadvantages list for all the reasons why you should and shouldn’t start your business. Remember that a number of potential cons such as financial or knowledge constraints on your list can be overcome with sensible problem solving. If after the exercise you have more advantages than disadvantages then it may be time to start.
Another great tool that helps many people is to understand your personality and how that works with other people. To understand your personality, you can complete a DISC personality profile test.
Use models such as DISC profiles to help you understand the way you operate as well as all your employees and how they work together.
Ready to start?
There is a lot that goes into starting a business. Especially if it is your first business and you do not have any prior experience.
I always cringe at the thought of people who think starting and running your own business will be a walk in the park. It requires huge commitment, persistence and dedication to a long term goal that may or may not come to fruition.
Do you have a business idea? How does it rank on the idea validation scale?
The word entrepreneur is thrown around far to often these days and we are going through a time where it is considered ‘cool’ to be one. Far to often people remain “wantrepreneurs” rather than being a true entrepreneur by starting something that is successful.
Let us know in the comments below how much of a struggle it was for you if you ever started a business. If you are yet to start, what is stopping you?
Are you considering starting a business and don’t know where to start? Our regular business insights will help you along your entrepreneurial journey.
Written by Joseph Chesterton
Joseph is the founder of Lemodus. He's obsessed with building businesses that help businesses grow. He founded Lemodus to introduce better processes and automation to the community. Lemodus is the number one tool to get your business under control.